Possible Effect of Merger and Acquisition on Brand …...4 Possible Effect of Merger and Acquisition...

Awan, Ho & Khan 1

Volume 12, Number 1, March 2017

Possible Effect of Merger and Acquisition on Brand Equity:

A Case Study of the IT Industry in South Korea

Mahmood A. Awan

SolBridge International School of International Business

Daejeon, South Korea

Corresponding Author: [email protected]

Han Chiang Ho

Wenzhou-Kean University, Wenzhou, China

[email protected]

Habib Ullah Khan

College of Business and Economics

Qatar University, Doha, Qatar

[email protected]

ABSTRACT

This study focuses on how mergers and acquisitions (M&A) affect the consumer’s

buying behavior, specifically the consumer’s perception, of both the parent and

acquired brand in the IT industry. The empirical test of the theoretical model was

conducted using data collected through a 5-point Likert-scaled survey

administered to a sample of 512 university students in South Korea. The students

were selected as respondents in order to increase the homogeneity of the sample

and to minimize random error caused by selecting the general public. The survey

was designed using real examples. Specifically, the first version of the survey used

the “Facebook & WhatsApp” case, and the second version used the “Microsoft &

Skype” case. Quantitative methodology was employed, using multi-group path

analyses for testing the hypotheses developed. The results confirm that brand

awareness and perceived brand value are important sources of brand equity and

that the effects of these two components on brand equity after M&A are

significantly larger than before M&A. The study provides insights into important

issues regarding brand equity and how to strengthen the evaluation of M&A of

online companies, which could also be useful for brand managers.

Keywords: Brand equity, merger and acquisition, consumer behavior, customer

perception, IT mergers, perceived brand value, band awareness

DOI: 10.6702/ijbi.2017.12.1.1

mailto:[email protected]



2 Possible Effect of Merger and Acquisition on Brand Equity:


International Journal of Business and Information

1. INTRODUCTION

Brand equity (BE) is the term that marketers use to refer to the value created

by establishing customer preference for one’s brand. Keller (2013) stated that

brand equity reflects the consumer’s feelings and actions toward the brand. It has

implications on the prices and profits of the brand in the marketplace and helps

market capitalization of the company owning that brand. Strong brand equity helps

to improve the marketingg of a firm. Aaker (1991) stated that there are five assets

of brand equity for the creation of value: brand loyalty, brand awareness, perceived

value, brand association, and other proprietary brand assets. Pappu & Quester

(2006) indicated that brand equity should be considered an indicator of “the state

of health” of a brand.

Today, although there is a global trend toward consolidation and going

forward, many firms are acquiring firms that have successful brands in order to

avoid the associated risks and the high cost of product development. Over the

decades, the practice of merger and acquisition (M&A) has attained considerable

significance in the contemporary scenario, and is used broadly to reorganize

business entities.

There are many benefits of M&A. Srivastava (2012) stated that M&A can

improve cost efficiency through economies of scale. Others have shown that M&A

can increase sales by gaining market share. Through M&A, firms can also buy new

technologies, products, and distribution channels and can thus achieve a desirable

position in the market. The principal benefit of M&A is increased value generation.

Evans (2000) observed that the best mergers seem to have four strategic reasons:

positioning (to take advantage of future opportunities), gap filling (to cover

weaknesses), organizational competencies, and broader market access.

Mergermarket (2014) reported that global M&A value is worth $599.1 billion,

with the technology sector contributing around $54.3 billion during the first quarter

of 2014. Two recent cases of M&A involving major brands are Microsoft with

Skype (Microsoft, 2012; Khan et al., 2014a; Khan, 2016) and Facebook with

Whatsapp (Reuters, 2014). Microsoft, which had previously hesitated to engage in

significant acquisitions, bought Skype for more than $8.56 billion in cash.

Facebook purchased the mobile messaging service Whatsapp for around $22

billion in cash and stock, in the firm’s largest acquisition ever. Since both Skype

and Whatsapp are online services, it is important to study how brand equity is

Awan, Ho & Khan 3


affected after the M&A of these organizations. No such study has been conducted

to date for the M&A of such online organizations.

Rios & Riquelme (2008) proved that brand awareness/brand recognition is an

important source of brand equity and that brand awareness/recognition contributes

to brand equity directly and indirectly in influencing customers. Their study

showed, however, that the impact of such a relationship is less than that of trust

and loyalty.

There are few studies in the literature on the relationship of M&A and

measurement of brand equity. Similarly, very little research is available on online

organizations and the information technology (IT) sector. The current study

examines the effects of brand equity on M&As in IT/online brands, focusing on

two recent cases of M&A in the IT industry. One is the acquisition of Skype by

Microsoft, and the other is the acquisition of Whatsapp by Facebook. In addition,

this study examines how consumer attitude changes toward the acquiring and

acquired brand after M&A, using a survey to measure the perceptions of

consumers about these two successful brands. Dean (2002) pointed out that the

balance theory is useful in explaining attitude formation and attitude change. This

study, therefore, uses balance theory to develop its hypotheses.

The rest of the paper is organized as follows. Section 2 contains a literature

review focusing on online brand equity and its application in the scenario of

information technology M&A. Section 3 presents the research methodology, and

Section 4 discusses data analysis. Section 5 presents the findings, and Section 6

offers conclusions and a discussion of limitations and suggestions for future

research.

2. LITERATURE REVIEW

In this study, four major constructs that influence brand equity are identified

and discussed in detail with regard to building the research model. They are brand

awareness, perceived brand value, functionality, and customer service.

2.1 Brand Awareness Brand awareness is “the ability of a buyer to recognize or recall that a brand

is a member of a certain product category” (Aaker, 1991). Keller (1993) pointed

out that brand awareness includes brand recognition and brand recall. Brand

recognition is associated with consumer experience and memory about having

heard or seen a brand. Brand recall is relevant to whether consumers can remember

a brand from memory. The customer’s awareness, in turn, insulates the brand from




its rivals and fosters loyalty for the brand. This attitude makes the brand conscious

of promising quality and persuades customers to pay a higher price for the product

(Halabi et al., 2014; Hakala et al., 2012; Khan, 2012; Bankole et al., 2017).

Hossein & Zeinab (2011) mentioned significant reasons for studying brand

equity, especially in the case of merging companies. They felt that brand equity is

useful not only to comprehend the level of awareness the customer has about the

strategic decisions and the brands, but also to forecast the financial throughput of

the corresponding venture (Hossein & Zeinab, 2011; Khan et al., 2013; Smuts et

al., 2017). According to Boo et al. (2009), the brand awareness of customers

assures them of the quality of the product and hence increases brand equity.

Baigi (2014) developed a model to ascertain the influence of brand awareness.

His study found that brand awareness is part and parcel of brand equity, which

increases the relationship with customers through the brand and makes them accept

the business decisions of the organization (Baigi, 2014).

While discussing the importance of customer awareness on a community

basis, Casaló et al. (2010) stated that the level of brand knowledge that the

members of the community possess is vital for improving brand equity. This

awareness is mandatory particularly in the case of the members of virtual

communities and social networking groups because opinion, ease of access, and

the behavior of one person influence the others. Research in this area, however, is

not sufficient to understand these constructs.

Bertea & Miosescu (2010) noted that irrespective of the other constraints that

can alleviate the position of the brand in the intensely competitive market,

“differential effect” can be created only through awareness of the product/brand.

2.2 Perceived Brand Value

Perceived value is conceptualized by Gill & Dawra (2010) as an important

construct to form the mix of brand experience. Kotler& Armstrong (2015) noted

that perceived value is “the customer’s evaluation of the difference between all the

benefits and all the costs of a marketing offer relative to those of competing offers.”

In terms of services companies, if they satisfy their customers’ needs and wants,

they will receive benefit from their services and will be pushed into a stronger

position in the long term (Hartnett, 1988; Ho et al., 2016; Khan & Ejike, 2017).

Lee et al. (2011) discussed the effect of perceived value in the case of the

merger of a brand. They inferred from their work that, if a low-image brand merged

with a high-image brand, the perceived value of the low-image brand would go up.

Awan, Ho & Khan 5


Considering the branding strategies of online companies, Rios & Riquelme (2010)

found that customers perceived value works as an antecedent in the case of the

branding strategies of Internet-based companies.

According to Fernández-Sabiote & Roman (2012), in a multi-channel context

of customer service, the perceived value of offline services is more than that of

online services. Yet, the former leads to the latter. So, traditional offline services

can lay the groundwork for customer relationships and hence brand equity.

Huang et al. (2011) considered 260 customers in their study to determine the

role of perceived value as a moderator in the decisive process of the purchase.

They found that perceived value influenced brand equity. Gill & Dawra (2010)

established that developing brand awareness and hence nurturing quality

consciousness and value creation are prerequisites for building brand equity.

2.3 Functionality

In the process of merging, it is very important that companies assess the level

of functionality of the brands both before and after the merger (Basu, 2006).

Functionality is broadly defined in terms of software that provides a memorable

and easy-to-use experience for users (Dabholkar, 1996; Rios & Riquelme, 2010;

Uwemi et al., 2016; Ejike et al., 2017). Petruzzellis (2010) noted that knowledge

of the brand through its functionality causes a change in the thought process of the

customer, thus attracting him or her to the brand. Ratnatunga & Ewing (2009)

posited that brand equity must be given enough prominence in the mergers.

Since the functionality of a brand is described as the combination of its focus,

attention, skill, knowledge, freedom, control, and interactivity (Hamzah et al.,

2014), understanding the customer’s view of brand equity with respect to these

constructs can help management to tailor its strategies (Hakala et al., 2012;

Omonaiye et al., 2015; Hassan et al., 2015; Bashir et al., 2016).

Klaus & Maklan (2013) highlighted the importance of interaction and

freedom of technology so that the brand equity of the technology-oriented

organization is fostered among its customers. Although much of the literature

stresses just the brand equity of companies, Yoo et al. (2000) revealed a dearth of

research for understanding brand equity in the case of mergers.

In their analysis and discussion of the prerequisite of Internet marketing

activities and the influence of those activities, Rios & Riquelme (2010) noted that,

in the case of online companies, confidence and knowledge about the service is

fostered by functionality, which further develops brand equity. Biedenbach (2012)




pointed out that the attitude of managers, being more concerned about functionality

alone, leads to the scarcity of research pertaining to other constructs of branding.

2.4 Customer Service

Customer service is identified as one of the important constructs for

evaluating a company (Chait et al., 2000; Khan & Alhusseini, 2015). Ivanovic &

Collin (2003) defined customer service as “a service given to customers once they

have made their decision to buy, including delivery, after-sales service, installation,

training, etc.” Customer service focuses on the interpersonal relationship between

employees and customers (Bitner et al., 1990; Uwemi & Khan, 2016). Vu &

Moisescu (2013) discussed the case of the organization Diageo Plc, the world’s

biggest alcohol producer, which was created by the merger of two market giants.

The problems that occurred during the evolution of this organization were resolved

by supporting customers financially. It is clear, therefore, that customer service

strategies can help a business to soar, irrespective of business decisions (merger,

acquisition, or some other decision).

Over the years, many studies have been done on customer-based brand equity,

but only a scant number of these studies have been related to a web based (online

technology) environment (Khan, 2013a; Awan et al., 2012; Rios & Riquelme,

2008). Brand experiences of the customer dictate his or her favoritism toward a

brand and constitute brand equity (Warraich et al., 2014). Brand equity can be

achieved not only by upgrading technology, but also by updating the customer

through pertinent promotional campaigns (Sadek et al., 2014; Bashir & Khan,

2016). Alwi & Kitchen (2014) indicated that widening the purview of service

transactions apart from sheer customer service could be the best way to create

brand differentiation and hence brand equity.

Fernández -Sabiote & Roman (2012) found that, in the online environment,

advanced technologies like “virtual agents” play a vital role in addressing customer

needs through the human touch and are therefore able to create a niche in the

market. On the whole, researchers have found that value-based strategies can boost

customer response for the products and services of all classes (Huang et al., 2011).

As a matter of fact, brand equity is one of the most important concepts in the

study of a brand, which has been researched by many researchers and marketers.

Brand and brand equity are considered buzz words in the competitive marketing

world because they provide identity for the company/organization. Aaker (1991)

Awan, Ho & Khan 7


defined brand equity as “a set of assets and liabilities linked to a brand, its name

and symbol that add to or subtract from the value provided by a product or service

to a firm and/or that firm’s customers.”

In a general sense, brand equity involves two approaches; namely, customer-

based brand equity (Keller, 1993) and financial-based brand equity (Simon &

Sullivan, 1993; Najmi et al., 2015; Askoul et al., 2016). Keller (1993) described

brand equity as the differential impact of brand knowledge on the responses of

consumers of the brand.

Simon & Sullivan (1993) pointed out that brand equity can be measured by

the financial value of the brand to the company. Although the term is frequently

used in business environments, the perspective toward it and the defined mix for

brand equity are domain-specific (Rios & Riquelme, 2010; Heang & Khan, 2015;

Hassan et al., 2016). The fact is that brand equity is the amalgam of customer

perception, the value that the product has accrued, and the good will of the brand,

which stands as a specific identity and breadwinner for the company (Kumar et al.,

2013; Khan, 2013b; Khan et al., 2014b).

Concepts related to brand equity include time and technology upgrades,

which make the process of brand management a complex artifact (Hamzah et al.,

2014; Musa et al., 2015; Awan & Khan, 2016). Added to this complexity are

internal factors such as mergers and acquisitions that play a significant role in the

brand equity of a company, which will generally pay more by neglecting the

perceptions of customers in this regard (Lee et al., 2011; Awan et al., 2016; Faisal

& Khan, 2016).

Studying brand equity provides the basis for strategic decisions such as

merger or acquisition; hence, assessing and forecasting brand equity are mandatory

for companies in designing future business plans (Khan & Faisal, 2015; Chen &

Green, 2011).

The current study, however, focuses on customer-based brand equity because

customers’ opinions toward the mergers and acquisitions (M&A) of high-tech

companies are the main goal of this study.

This study compares the difference between before and after M&A of a parent

and acquired brand in the IT industry. It explores the relationship among the

dimensions of brand equity (Aaker, 1991; Keller, 2008; Khan et al., 2016) and

product functionality, customer service, brand awareness, and perceived brand

value. As shown in the empirical model in Figure 1, product functionality (Func)

and customer service (CS) are considered independent variables, and brand




awareness, perceived brand value (PV), and brand equity (BE) are considered

dependent variables.

Figure 1. The Empirical Model for Current Study

In the early 1990s, researchers pointed out that a firm’s customer service is

very relevant to consumers’ perceived brand value (Cronin & Taylor, 1992; Khan

& Fournier-Bonilla, 2016). Brand awareness plays an essential role in determining

the evaluation of brand equity (Huan & Sarigollu, 2012). At present, there is not

enough knowledge in the literature relating to how these dimensions impact

consumers to form an opinion about one dimension over others.

The present study focuses on how consumer preferences toward brand equity

are affected by brand awareness, perceived brand value, functionality, and

customer service. Based on their limited literature review and their understanding

of the nomology of the concepts, the authors designed the empirical model shown

above in Figure 1. Based on the preceding discussion, the authors formulated the

following six hypotheses for this study:

H1: According to customer perception, the brand awareness of the products

will cause a significant increase in the influence on brand equity, after M&A.

H2: According to customer perception, the perceived brand value of the

products will cause a significant increase in the influence on brand equity,

after M&A.

H3: According to customer perception, the functionality of the products will

cause a significant increase in the influence on brand awareness, after M&A.

Awan, Ho & Khan 9


H4: According to customer perception, the functionality of the products will

cause a significant increase in the influence on perceived brand value, after

M&A.

H5: According to customer perception, the customer service of alliance

companies will cause a significant increase in the influence on brand

awareness, after M&A.

H6: According to customer perception, the customer service of alliance

companies will cause a significant increase in the influence on perceived

brand value, after M&A.

3. METHODOLOGY This section discusses the data collection process, presents a profile of the

survey respondents, and describes methods and procedures for this study.

3.1 Data Collection Process To verify the consistency of their empirical tests, the authors conducted two

surveys to collect consumer responses. The empirical test of the theoretical model

was conducted using data collected from the survey of a sample of university

students. The survey was designed using real examples. Specifically, the first

version of the survey used the “Facebook & WhatsApp” case, whereas the second

version used the “Microsoft & Skype” case. The merger and acquisition strategies

of the four companies in the study were chosen because of the market spread of

the companies and hence the ease of evaluating the brand equity by customers.

Respondents were randomly assigned to one of the two versions of the

questionnaire. The independent t-tests showed that consumers’ attitudes were

indifferent toward the two acquirers – Microsoft and Facebook – (t = -0.90, df =

522, p = 0.90), and the two acquired companies – Skype and WhatsApp – (t = 0.05,

df = 522, p = 0.96). Consumers’ brand familiarity toward the four companies used

in these studies was tested because respondents who were familiar with the

companies could easily evaluate the “equal” contributions of each company

(Simonin & Ruth, 1998). Results showed that, on average, the brand familiarity of

the two main companies, Microsoft (M = 4.26) and Facebook (M = 4.33), and the

two merged companies, Skype (M = 3.14) and WhatsApp (M = 2.98), was similar.




3.2 Profile of Respondents

Korean university students were selected as respondents in order to increase

the homogeneity of the sample and to minimize random error that would be caused

by selecting the general public (Calder et al., 1981; Das & Khan, 2016). Students

are ideal respondents for this study because research shows that a large proportion

(91%) of university students use messaging apps such as Facebook to

communicate and share photos with others, on an average of 10 to 30 minutes daily

(Wiley & Sisson, 2006; Ellison et al., 2007).

In addition, the student sample was selected based on its internal validity for

consumer behavior analysis, as recognized in previous related academic work on

attitude formation (Sicilia et al., 2006; Backhaus et al., 2001). According to

Stevens (2011), most objections to the use of student samples focus on the lack of

generalizability. When there is no theoretical reason to expect that one specific

sample would react in a different way than another and when the research priority

is accurate to establish causal relationships, internal validity justifies the use of a

student sample. Peterson (2001), in his meta-analysis, found that college students

tend to be more homogeneous than non-student samples.

Students completed the surveys as partial fulfillment of their marketing

courses. A sample of 428 surveys was obtained. After excluding invalid items, the

authors kept 374 valid surveys for the study. Of the total, 47% of the respondents

were male (nmale = 178, nfemale = 196). The ratios of the sample size to survey items

(15 items) for the sample satisfied the minimum requirements specified by both

Gorsuch (1983) and Thompson (2000). A detailed demographic profile of

respondents is shown in Table 1.

Awan, Ho & Khan 11


Table 1. Demographic Profile of Respondents

Total sample size n = 374 Male (nmale = 178) Female (nfemale = 196)

Frequency % Frequency %

Gender

1 Male 178 45

2 Female 196 55

Education

1 Some college 0 0 0 0

2 University undergraduate 161 90.5 178 90.6

3 University graduate 17 9.5 18 9.4

Age

1 Under 20 years 91 51.2 119 60.9

2 21-30 years 87 48.8 77 39.1

3 31 or older 0 0 0 0

Annual Household Income

1 Under $10,000 11 6.0 12 6.3

2 $10,000 - $29,999 53 29.8 44 22.7

3 $30,000 - $49,999 49 27.4 35 18.0

4 $50,000 - $69,999 28 15.5 54 27.3

5 $70,000 - $99,000 17 9.5 31 15.6

6 $100,000 or more 21 11.9 20 10.2

How long have you been using messaging

app?

1 1 - 2 years 42 23.8 54 27.3

2 3 - 4 years 78 44.0 87 44.5

3 5 – 6 years 42 23.8 43 21.9

4 7 years or longer 15 8.3 12 6.3

What is the frequency that you use

messaging app to contact someone?

1 1 - 5 times one month 0 0 3 1.6

2 1 - 5 times one week 28 15.5 15 7.8

3 1 - 5 times one day 55 31.0 70 35.9

4 More than 6 times one day 95 53.6 107 54.7

How many messaging apps do you have in

your device(s)?

1 1 messaging app 4 2.4 2 0.8

2 2 messaging apps 21 11.9 23 11.7

3 3 messaging apps 55 31.0 46 23.4

4 4 messaging apps 80 45.2 104 53.1

5 5 messaging apps or more 17 9.5 21 10.9




3.3 Measures and Procedures

Both versions of the survey contained company logos, names, and a brief

introduction on the M&A of the acquirer company and the acquired company. The

beginning of each survey presented a definition of M&A and messaging app and

listed the M&A events of the acquirer companies (Facebook and Microsoft) and

the acquired companies (WhatsApp and Skype). Each survey contained three

questions each relating to the six variables in this study: brand familiarity, brand

awareness, perceived brand value, functionality, customer service, and brand

equity (see Appendix). Each question was on a 5-point Likert scale, ranging from

1 (strongly disagree agree) to 5 (strongly agree). Only respondents with an average

sum of more than 3 were considered valid responses.

First, respondents were tested on their familiarity with each brand.

Respondents were asked to express their opinion about before/after M&A of the

acquirer company and the acquired company. To ensure reliability and validity,

the authors adapted the measurement items from previous studies. To measure

brand awareness, the authors used the scale developed by Yoo et al. (2000). The

authors used the scale by Sweeney & Soutar, (2001) to measure perceived brand

value. To measure product functionality, the authors used items from Suppehellen

& Nysveen (2001). Consumer service was measured using items from Burke

(2002). Brand equity was measured using a scale developed by Yoo et al. (2000).

For the sake of consistency, easy understanding, and context fitness of the

measurement items, the authors conducted a pilot test with 50 respondents in order

to pre-test reliability, convergent validity, and discriminant validity. After all

measurement items showed the fitness of the constructs, the authors adopted those

items into formal empirical tests.

Table 2 presents the results of the assessment of internal consistency and

convergent validity. Regarding the formal empirical test, the table indicates that

the Cronbach’s alphas (α) for all constructs were above 0.6, which is considered

an acceptable level (Bagozzi & Yi, 1988). All items of composite reliability (CR)

exceeded the threshold value of 0.7 of internal consistency (Fornell & Larcker,

1981). In addition, the average variance extracted (AVE) values were above the

recommended threshold value 0.5 for all constructs (Fornell & Larcker, 1981).

Therefore, convergent validity is accepted.

Awan, Ho & Khan 13


Table 2. Assessment of Internal Consistency and Convergent Validity

Cronbach’

s Alpha

(α)

Composite

Reliability

(CR)

Average

Variance

Extracted (AVE)

Facebook (F)

Functionality 0.84 0.90 0.73

Consumer service 0.76 0.89 0.75

Awareness 0.91 0.94 0.77

Perceived value 0.91 0.94 0.74

Brand equity 0.93 0.95 0.80

WhatsApp (W)



Awareness 0.95 0.95 0.84



Microsoft (M)



Awareness 0.94 0.94 0.65



Skype (S)



Awareness 0.92 0.92 0.79



The authors measured discriminant validity using the test suggested by

Fornell & Larcker (1981). Good discriminant validity is represented as all square

roots of the AVE (diagonal elements), which are greater than the correlations

between constructs (off-diagonal). Table 3 shows the mean and standard deviations

(SD) and assessment of the discriminant validity of each construct.




Table 3. Assessment of Discriminant Validity

Facebook

Mean SD A BE C F PV

A 4.33 0.95 0.77

BE 3.41 1.03 0.33 0.80

C 3.26 1.01 0.10 0.51 0.75

F 3.64 0.95 0.41 0.49 0.42 0.73

PV 3.64 0.87 0.65 0.49 0.36 0.56 0.74

Microsoft

Mean SD A BE C F PV

A 4.26 0.93 0.65

BE 3.49 0.94 0.63 0.87

C 3.29 0.96 0.32 0.54 0.79

F 3.66 0.83 0.50 0.59 0.54 0.83

PV 3.78 0.80 0.68 0.46 0.47 0.47 0.86

Skype

Mean SD A BE C F PV

A 3.14 0.99 0.79

BE 3.23 0.98 0.37 0.87

C 3.27 0.95 0.43 0.57 0.81

F 3.45 0.91 0.53 0.47 0.59 0.75

PV 3.51 3.51 0.52 0.56 0.48 0.58 0.89

A = Awareness; BE = Brand Equity; C = Customer service; F = Functionality; PV =

Perceived Value

WhatsApp

Mean SD A BE C F PV

A 2.98 1.46 0.84

BE 2.33 1.19 0.53 0.82

C 2.65 1.25 0.55 0.62 0.73

F 2.71 1.27 0.63 0.59 0.65 0.68

PV 2.81 1.19 0.62 0.43 0.59 0.57 0.81

Awan, Ho & Khan 15


Diagonal elements represent the square root of AVE for each construct; off-diagonal

elements are correlations among constructs.

4. RESULTS AMOS™ 22 software was used to perform four multi-group path analyses to

test the conceptual model. In terms of the indices of model fit, the values of

goodness of fit (GFI), comparative fit index (CFI), and incremental fit index (IFI)

were above 0.9 (Bagozzi & Yi, 1988). The root mean square error of

approximation (RMSEA), which is another important index of measurement of fit,

had a value of less than 0.05, representing a good model fit (Baumgartner &

Homburg, 1996). This was a saturated model; therefore, it fit the data perfectly.

Some of the hypothesized paths were found to be non-significant at the 5%

significance level and the significant model. The result was the models shown later

in Figure 2 through Figure 5, following tables 4, 5, and 6.

These models are constrained versions of the theoretical model displayed in

Figure 1, with some direct paths fixed to zero. The fits of the resulting sample

model are excellent. The result for each company shows that the p-value χ2 (chi-

square test) is larger than 0.05:

Facebook: 2(9) = 8.911, p = 0.55; GFI = 0.98; CFI = 0.99; IFI = 0.98;

RMSEA = 0.00

WhatsApp: 2(9) = 9.163, p = 0.57; GFI = 0.99; CFI = 0.99; IFI = 0.98;

RMSEA = 0.00

Microsoft: 2(9) = 7.946, p = 0.46; GFI = 0.98; CFI = 0.98; IFI = 0.99;

RMSEA = 0.01

Skype: 2(9) = 9.732, p = 0.63; GFI = 0.99; CFI = 0.99; IFI = 0.98; RMSEA

= 0.00)

Consequently, all descriptive goodness of fit indices show that the data fit

the model well. Table 4 shows the summary of fitness indices for each model.

Table 4. Summary of Fitness Index for Each Model

Company 2 (d.f.) p GFI CFI IFI RMSEA

Facebook 8.911 (9) 0.55 0.98 0.99 0.98 0.00

WhatsApp 9.163 (9) 0.57 0.99 0.99 0.98 0.00

Microsoft 7.946 (9) 0.46 0.98 0.98 0.99 0.00

Skype 9.732 (9) 0.63 0.99 0.99 0.98 0.00




Table 5 presents the empirical results for before/after M&A for each of the four

companies.

Table 5. Empirical Results for Each of the Four Companies

Before M&A

After M&A

Critical

Ratios for

Coefficient

Differences

Proposed Path Coef. p Coef. p |z|

Facebook

H1 Awareness →

BE

0.35 0.000 * 0.53 0.000 * -0.62

H2 PV → BE 0.65 0.000 * 0.73 0.000 * -0.73

H3 Func →

Awareness

0.49 0.000 * 0.56 0.000 * -0.81

H4 Func → PV 0.51 0.000 * 0.58 0.000 * -1.18

H5 CS →

Awareness

0.31 0.000 * 0.07 0.444 3.67 ††

H6 CS → PV 0.14 0.027 * 0.13 0.042 * -0.07

WhatsApp

H1 Awareness →

BE

0.01 0.908 0.20 0.025 * -1.75 ††

H2 PV → BE 0.53 0.000 * 0.64 0.000 * 1.54

H3 Func →

Awareness

0.57 0.000 * 0.61 0.000 * -0.25

H4 Func → PV 0.55 0.000 * 0.64 0.000 * -1.05

H5 CS →

Awareness

0.22 0.189 0.34 0.022 * 0.56

H6 CS → PV 0.27 0.003 * 0.48 0.000 * 1.53

--Continued

Table 5 (Cont’d). Empirical Results for Each of the Four Companies

Awan, Ho & Khan 17


Before M&A

After M&A

Critical Ratios

for

Coefficient

Differences

Proposed Path Coef. p Coef. p |z|

Microsoft

H1 Awareness →

BE

0.46 0.000 * 0.54 0.000 * 0.32

H2 PV → BE 0.72 0.000 * 0.83 0.000 * -0.23

H3 Func →

Awareness

0.51 0.000 * 0.59 0.000 * 0.72

H4 Func → PV 0.53 0.000 * 0.81 0.000 * 3.89 ††

H5 CS →

Awareness

0.19 0.026 * 0.11 0.296 0.66

H6 CS → PV 0.18 0.006 * 0.07 0.363 -2.49 ††

Skype

H1 Awareness →

BE

0.31 0.000 * 0.53 0.000 * 0.56

H2 PV → BE 0.64 0.000 * 0.69 0.000 * -0.87

H3 Func →

Awareness

0.43 0.000 * 0.46 0.000 * 0.34

H4 Func → PV 0.56 0.000 * 0.58 0.000 * 0.40

H5 CS →

Awareness

0.19 0.060 *

*

0.15 0.119 -0.32

H6 CS → PV 0.35 0.000 * 0.26 0.000 * 0.13

* p < 0.05; ** p < 0.10; ††: |z| > 1.645, p <0.10

As hypothesized, the data in Table 5 indicates that brand awareness plays a

significant role in affecting brand equity for Facebook, Microsoft, and Skype. The

effect after M&A for each company is larger than before M&A:

F_ABE(Before) = 0.35, p < 0.01) < (F_ABE(After) = 0.53, p < 0.01.

M_ ABE(Before) = 0.46, p < 0.01) < (M_ ABE(After) = 0.54, p < 0.01.

S_ ABE(Before) = 0.31, p < 0.01) < (S_ ABE(After) = 0.53, p < 0.01.

Furthermore, there is an improved effect of brand awareness on brand equity in

WhatsApp, which is insignificant in before M&A and significant in after M&A:

W_ABE(Before) = 0.01, p = 0.908, W_ABE(After) = 0.20, p < 0.05.

H1 is thus confirmed.




Perceived brand values significantly affect brand equity in all four companies.

In addition, the effect of after M&A is larger than before M&A for each company:

F_PVBE(Before) = 0.65, p < 0.01) < (F_PVBE(After) = 0.73, p < 0.01.

W_ PVBE(Before) = 0.53, p < 0.01) < (W_PVBE(After) = 0.64, p < 0.01.

M_ PVBE(Before) = 0.72, p < 0.01) < (M_ PVBE(After) = 0.83, p < 0.01.

S_ PVBE(Before) = 0.64, p < 0.01) < (S_ PVBE(After) = 0.69, p < 0.01.

H2 is therefore supported.

The effect of product functionality on brand awareness for each company is

significant for both before and after M&A, as shown in Table 5. The effects of

after M&A are all larger than before M&A:

F_FuncA(Before) = 0.49, p < 0.01, F_FuncA(After) = 0.56, p < 0.01.

W_ FuncA(Before) = 0.57, p < 0.01, W_ FuncA(After) = 0.61, p < 0.01.

M_ FuncA(Before) = 0.51, p < 0.01, M_ FuncA(After) = 0.59, p < 0.01.

S_ FuncA(Before) = 0.43, p < 0.01, S_ FuncA(After) = 0.46, p < 0.01).

Therefore, H3 is supported.

The effect of product functionality on perceived brand value for each

company is also significant between before and after M&A, and the effect of after

M&A is bigger than before M&A:

F_FuncPV(Before) = 0.51, p < 0.01, F_FuncPV(After) = 0.58, p < 0.01.

W_ FuncPV(Before) = 0.55, p < 0.01, W_ FuncPV(After) = 0.64, p < 0.01.

M_ FuncA(Before) = 0.53, p < 0.01, M_ FuncA(After) = 0.81, p < 0.01.

S_ FuncA(Before) = 0.56, p < 0.01, S_ FuncA(After) = 0.58, p < 0.01).

HA is therefore supported.

Regarding H5, the effects of customer service on brand awareness of

Facebook, Microsoft, and Skype are significant in before M&A:

F_CSA(Before) = 0.31, p < 0.01.

M_CSA(Before) = -0.19, p < 0.05.

S_CSA(Before) = 0.19, p < 0.10.

The effects of customer service on brand awareness are insignificant, however, in

after M&A for Facebook, Microsoft, and Skype:

F_CSA(After) = 0.07, p = 0.444.

M_CSA(After) = 0.11, p = 0.296.

S_CSA(After) = 0.15, p = 0.119.

Awan, Ho & Khan 19


The improved effect is only in WhatsApp, where customer service does not play

an important role in influencing brand awareness efore M&A (W_CSA(Before) = 0.22,

p < 0.189), but does play an important role after M&A (W_CSA(After) = 0.35, p <

0.05). Hence, H5 is not supported.

The effect of customer service on perceived brand value is improved only in

WhatsApp, whose effect of customer service on perceived brand value in after

M&A (W_CSPV(After) = 0.48, p < 0.01) is larger than before M&A (W_CSPV(Before)

= 0.27, p < 0.05). The effects for the other three companies are not supported.

Either the effect of before M&A is larger than after M&A, or there is an

insignificant result in after M&A:

Facebook: (F_CSPV(before) = 0.14, p < 0.05) > (F_CSPV(After) = 0.13, p < 0.05);

Microsoft: (M_CSPV(before) = 0.18, p < 0.05; M_CSPV(After) = 0.07, p = 0.363);

Skype: (S_CSPV(before) = 0.35, p < 0.01) > (S_CSPV(After) = 0.26, p < 0.01)).

H6, therefore, is not supported.

Table 6 summarizes the empirical results for each of the six hypotheses in this

study.

Table 6. Summary of Results for Each Hypotheses in Study

Hypothesis Brief Description Relation Results

H1 Brand Awareness Brand Equity + Not Supported

H2 Perceived Brand Value Brand Equity + Supported

H3 Product Functionality Brand

Awareness

+ Supported

H4 Product Functionality Perceived

Brand Value

+ Supported

H5 Customer Service Brand Awareness + Not Supported

H6 Customer Service Perceived Brand

Value

+ Not Supported

Apart from the total (direct) effect shown earlier in Table 5, it is necessary to

consider the indirect effects of components on brand equity. These indirect effects

are explored by adding product functionality and customer service via whole

possible paths to brand equity. The AMOS results indicate that all indirect effects




of product functionality are larger than the effects of customer service on brand

equity, even though part effects are not significant:

F_IndieffFunc_BE(Before) = 1.308 > F_IndieffCS_BE(Before) = 0.374,

F_IndieffFunc_BE(After) = 1.146 > F_IndieffCS_BE(After) = 0.425;

W_IndieffFunc_BE(Before) = 0.725 > W_IndieffCS_BE(Before) = 0.664,

W_IndieffFunc_BE(After) = 0.889 > W_IndieffCS_BE(After) = 0.380;

M_IndieffFunc_BE(Before) = 1.308 > M_IndieffCS_BE(Before) = 0.374,

M_IndieffFunc_BE(After) = 1.298 > M_IndieffCS_BE(After) = 0.058;

S_IndieffFunc_BE(Before) = 1.029 > S_IndieffCS_BE(Before) = 0.464,

S_IndieffFunc_BE(After) = 1.149 > S_IndieffCS_BE(After) = 0.538).

(Before M&A)

(After M&A)

*Only significant relationships are presented.

Figure 2. Results for Facebook, Before and After M&A

Awan, Ho & Khan 21


(Before M&A)

(After M&A)


Figure 3. Results for WhatsApp, Before and After M&A




(Before M&A)

(After M&A)


Figure 4. Results for Microsoft, Before and After M&A

Awan, Ho & Khan 23


(Before M&A)

(After M&A)


Figure 5. Results for Skype, Before and After M&A

5. DISCUSSION

The central aim of this study is to identify the drivers of brand equity,

especially for the M&A of online companies. The study provides new insights into

important issues regarding brand equity and the exact direction for strengthening

the evaluation of the M&A of online companies. Most of the previous research on

brand equity dealt mainly with analyzing the impact of unilateral antecedents on

consumer evaluation, without extending the different periods through which the

same successful drivers of brand equity before/after M&A may impact consumer

evaluation differently.




By decomposing M&A activities into two periods, this paper sheds light on

the subtle routes underlying consumer evaluation in the online company cases of

brand equity between before and after M&A. The results from both before and

after M&A of these companies also offer significant theoretical and managerial

contributions to the literature on brand equity, in several ways.

In this study, brand awareness and perceived brand value are proved to be

important sources of brand equity, a finding that coincides with the results of

research by Keller (2013) and Rios & Riquelme (2008). The current study shows

that, among the four companies studied, the effects of brand awareness and

perceived brand value on brand equity after M&A are significantly larger than

before M&A for three of the companies (WhatsApp, Microsoft, and Skype). The

positive effects on the brand equity of the parent and acquired companies reflect

why the parent brand originally intended to implement M&A. It should be noted

that the importance of perceived brand value in terms of its total effect on brand

equity is about four times larger than that of brand awareness. The result implies

that perceived brand value is more important in the consumers’ minds than brand

awareness when they are faced with this M&A operation. This result supports

previous research by Yoo et al. (2000), who pointed out the existing, significantly

weak relation between brand awareness and brand equity.

Product functionality is a major component directly and indirectly affecting

the importance of brand awareness and perceived brand value in building brand

equity. Functionality has significantly improved effects on brand awareness after

M&A for all four companies in this study. These results coincide with those of

Berry (2000) and Chiu & Wang (2000). The results show that the effects of

functionality on perceived brand value are almost larger than its effects on brand

awareness for three of the companies, but is a bit smaller before M&A for

WhatsApp. Some of the results are consistent with those of Page & Lepkowska-

White (2002), who found that, by providing reliable functionality, online

companies generally increase consumers’ perceived brand value. Although the

current study does not directly measure hypotheses between product functionality

and brand equity, such effects are assessed by examining alternative paths in the

empirical model and by checking the importance through indirect effect. The

results confirm the importance of product functionality in terms of its indirect

effects on brand equity through brand awareness and perceived brand value. Hence,

the importance of product functionality cannot be underestimated.

Awan, Ho & Khan 25


In the current study, customer service, the other interesting marketing

component, does not show consistent effects on brand awareness and perceived

brand value. Regarding the two acquirer companies (Facebook and Microsoft), it

was found that customer service after M&A does not maintain/improve the effects

on brand awareness and perceived brand value, and may, in fact, worsen the effects.

For the two acquired companies (WhatsApp and Skype), customer service after

M&A almost maintains/improves the effects on brand awareness and perceived

brand value, especially for WhatsApp. It is possible that consumers perceive that,

after M&A, the acquirer companies need to help the acquired companies solve

increased technical problems and relevant product problems from new consumers.

On the other hand, it is also possible that acquired companies could receive support

from acquirers, a situation that would cause consumers to have more confidence

in their customer service. In this situation, there are two tasks for managers. The

first task is to put more effort in exploring the means to improve customer service

in order to increase consumer identification toward the company’s brand

awareness and perceived brand value. The second task is to transfer company

resources from customer service to other departments, an action that could enhance

the company’s brand awareness and perceived brand value in the mind of its

consumers. In-depth business analyses are required to determine which business

strategy is suitable for the company.

The effects of customer service on brand awareness and perceived value have

a significantly improved contribution only in the case of WhatsApp. The other

three companies (Facebook, Microsoft, and Skype) do not benefit from customer

service. Because of the special characteristics of customer service, its quality is

often inconsistent (Kerin et al., 2015). Inconsistency is sometimes a bigger

problem in customer service than it is in product functionality. Different

consumers may have different perceptions of service quality, whereas different

companies may provide distinct customer service quality. Inconsistency, therefore,

may be one of reasons for inconsistent results regarding customer service in the

four companies.

In sum, the empirical results of the current study indicate that the M&A of

online companies could help the companies enhance their brand equity.

5.1 Managerial Implications

The findings of this study have several implications for marketing managers

in the IT industry. The study provides new insights into important issues regarding




brand equity and the exact direction for strengthening the evaluation of M&A of

online companies, which could be useful for brand managers.

The finding that M&A in the IT industry influences functionality and

customer service indicates that brand awareness and perceived brand value are

important in increasing the positive perception of brand equity. Marketers should

concentrate on strengthening those elements in order to achieve the desired

perception. They should enhance their promotion strategy of the M&A in terms of

process and staff so as to attain highly positive images.

Because positive functionality and customer service generate a positive level

of increasing brand awareness and perceived brand value directly and brand equity

indirectly, marketers in parent companies should concentrate on improving the

quality of IT products and customer service in light of tangible and intangible

attributes. These efforts will create a high level of brand equity in the minds of

consumers.

In the IT industry, marketing strategy may not be effective sometimes in

influencing brand equity for consumers. Likewise, product functionality and the

customer service of social media or online communications software may not have

much influence on consumers in terms of choosing it as the only online tool they

want to use. A strong product functionality and good customer service are

favorable, however, with regard to creating a high level of brand equity for

consumers To maximize synergy from the M&A process, therefore, marketers

should discreetly care about the paths from product functionality and customer

service to brand awareness and perceived brand value, and from brand awareness

and perceived value to brand equity.

Compared with tangible products such as cars or books, it is not easy to

maintain the quality of customer service at the same level. Different customers

may have varied responses to the level of service. To enhance the brand equity of

a company, therefore, staff should be educated and encouraged to maintain a

similar or identical level of customer service.

Furthermore, to create a high level of recognition for the M&A, marketers

must have strong and positive management of the relationship with customers. In

so doing, they have an excellent opportunity to achieve a successful M&A.

Awan, Ho & Khan 27


5.2 Limitations and Future Research

Apart from its contributions, this study has several limitations. First, it targets

only one segment. Further studies might incorporate other segments and include

more professionals from different countries.

Second, the current study focuses only on the IT industry. Future studies

could be enlarged to include other industries.

Third, the current study uses a convenience sample of university students as

respondents. Although student samples reduce problems of heterogeneity, this

method may limit generalization. A student sample might be appropriate to test

and develop students because they are the users of the software. Future research

could test this model with the general public for generalizability.

Fourth, the observable variables in the current study may not be

comprehensive enough. For a more in-depth exploration, future research could

define and measure broader observable variables – e.g., sustainable competitive

advantage or company image (Kim et al., 2011).

Fifth, this study was designed to perform cross-sectional analysis to discuss

consumer attitudes toward M&A, before and after. For reasons of completeness

and robustness, future studies might adopt longitudinal analysis in order to gain a

deep understanding of consumer attitudes.




APPENDIX:

SURVEY QUESTIONS FOR EACH VARIABLE

Brand Familiarity

No. Question

1 I am extremely familiar with the Facebook brand name.

2 I definitely recognize the Facebook brand name.

3 I definitely have heard of the Facebook brand name before.

Brand Awareness

No. Question

1 I can recognize Facebook among competing brands.

2 I am aware of Facebook.

3 I can quickly recall the symbol or logo of Facebook.

Perceived Brand Value

No. Question

1 Facebook has consistent quality.

2 Facebook has an acceptable standard of quality.

3 Facebook would perform consistently.

Functionality

No. Question

1 I have a preference for Facebook because it is easy to use.

2 I like Facebook because it offers consistent accessibility.

3 I like Facebook because it remembers my preferences.

Customer Service

No. Question

1 I like Facebook because it offers alternative customer support (call center, toll

free, e-mail, or “live individuals”).

2 I have a preference for Facebook because it offers specialized customer support.

Brand Equity

No. Question

1 Even if another brand has the same features as Facebook, I would prefer to use

Facebook.

2 If another brand is not different from Facebook in any way, it seems smarter to

purchase Facebook.

3 Even if there is another brand as good as Facebook, I prefer to use Facebook.

4 It makes sense to use Facebook instead of any other brand, even if they are the

same in quality.

Awan, Ho & Khan 29


REFERENCES

Aaker, D.A. (1991). Managing brand equity: Capitalizing on the value of a brand name,

New York, NY: The Free Press.

Alwi, S.F.S., & Kitchen, P.J. (2014). Projecting corporate brand image and behavioral

response in business schools: Cognitive or affective brand attributes, Journal of Business

Research, 67(11), 2324. doi: https://doi.org/10.1016/j.jbusres.2014.06.020

Awan M.A., Khan, H.U., & Zhang, W. (2012). A comparative study on online service

quality perception of two major regional economies, International Journal of e-

Education, e-Business, e-Management and e-Learning (IJEEEE), 2(6), 529.

doi: https://doi.org/10.7763/ijeeee.2012.v2.178

Askoul, R., Khan, H.U,. & Madhavi Lalitha, V.V. (2016). Cross-functional integration

of marketing and information services in banking: A cross-industry comparison,

International. Journal of Process Management and Benchmarking, 6(1). 57-78.

doi: https://doi.org/10.1504/ijpmb.2016.073326

Awan, M.A., Khan, H U., & Ho, H.C. (2016). Online banking: A comparative study of

Chinese and Saudi customer perceptions of service quality, Journal of Internet Banking

and Commerce, 21(S5).

Awan, M.A., & Khan, H.U. (2016). Status of Internet addiction among college students:

A case of South Korea, Proceedings, First American Academic Research Conference on

Global Business, Economics, Finance and Social Sciences, AAR16 New York

Conference, May 25 - May 28, 2016.

Backhaus, K., Muhlfeld, K., & Van Doorn, J. (2001), Consumer perspectives on

standardization in international advertising: A student sample, Journal of Advertising

Research, 41(5), 53-61. doi: https://doi.org/10.2501/jar-41-5-53-61

Bagozzi, R.P., & Yi, Y. (1988). On the evaluation of structural equation model, Journal

of the Academy of Marketing Science, 16:74-94.

doi: https://doi.org/10.1007/bf02723327

Baigi, S.R. (2014). Investigation of relationship between brand equity of services and

brand relationship, Kuwait Chapter of the Arabian Journal of Business and Management

Review, 3(12), 245-253. doi: https://doi.org/10.12816/0018820

Bankole, O A., Lalitha, M., Khan, H.U., & Jinugu, A. (2017). Information technology in

the maritime industry, past, present and future: Focus on LNG carriers, Proceedings of

the 7th IEEE International Advanced Computing Conference, Hyderabad, India, January

5-7, 2017.

https://doi.org/10.7763/ijeeee.2012.v2.178




Bashir, G.M., & Khan, H.U. (2016). Factors affecting learning capacity of information

technology concepts in a classroom environment of adult learner, Proceedings of the

15th International Conference on Information Technology Based Higher Education and

Training, IEEE Conference, Istanbul, Turkey, September 8-10, 2016.

doi: https://doi.org/10.1109/ithet.2016.7760729

Bashir, G.M., Khan, H.U., & Fournier-Bonilla, S.D. (2016). Applying andragogy theory

to an adult multicultural audience: How cultural factors influence the capacity for adults

to learn information technology concepts in a classroom environment, Proceedings of

the Northeast Decision Sciences Institute Conference, Alexandria, Virginia, USA,

March 31-April 2, 2016.

Basu, K. (2006). Managing brands after mergers, California Management Review, 48(4),

28-42. doi: https://doi.org/10.2307/41166359

Biedenbach, G. (2012). Brand equity in the business-to-business context: Examining the

structural composition, Journal of Brand Management, 19(8), 688-701.

doi: https://doi.org/10.1057/bm.2011.60

Berry, L.L. (2000). Cultivating service brand equity, Journal of the Academy of Marketing

Science, 28(1), 128-137. doi: https://doi.org/10.1177/0092070300281012

Bertea, P., & Moisescu, O.I. (2010). Investigating the role of brand awareness in reducing

the perceived risk associated to online buying of tourism services, Marketing – From

Information to Decision, 3: 9-18.

Boo, S., Busser, J,. & Baloglu, S. (2009). A model of customer-based brand equity and

its application to multiple destinations, Tourism Management, 30: 219- 231.

doi: https://doi.org/10.1016/j.tourman.2008.06.003

Burke, R.R. (2002). Technology and customer interface: What consumers want in the

physical and virtual store, Journal of the Academy of Marketing Science, 34(4), 411-432.

doi: https://doi.org/10.1177/009207002236914

Casaló, L.V., Flavian, C., & Guinaliu, M. (2010). Relationship quality, community

promotion and brand loyalty in virtual communities: Evidence from free software

communities, International Journal of Information Management, 30(4), 357-367.

doi: https://doi.org/10.1016/j.ijinfomgt.2010.01.004

Calder, B.J., Philips, L.W., & Tybout, A.M. (1981). Designing research for application,

Journal of Consumer Research, 8: 197-207. doi: https://doi.org/10.1086/208856

https://doi.org/10.1177/009207002236914

Awan, Ho & Khan 31


Chait, H., Carraher, S.M., & Buckley, M. (2000). Measuring service orientation with

biodata, Journal of Managerial Issues, 12: 109-120.

Chen, H., & Green, R.D. (2011). Brand equity, marketing strategy, and consumer income:

A hypermarket study, Journal of Management and Marketing Research, 8: 1-18.

Chiu, C.H., & Wang, F.M. (2000). The influence of navigation map scope on

disorientation of elementary students in learning a web-based hypermedia course,

Journal of Educational Computing Research, 22(2), 135-144.

doi: https://doi.org/10.2190/fywa-c9c1-mha6-0kay

Cronin, J.J., & Taylor, S.A. (1992). Measuring service quality: A re-examination and

extension, Journal of Marketing, 56(8), 55–68. doi: https://doi.org/10.2307/1252296

Dabolkar, P.A. (1996). Consumer evaluation of new technology-based self-service options:

An investigation of alternative models of service quality, International Journal of

Research in Marketing, 13(1), 29-51.

doi: https://doi.org/10.1016/0167-8116(95)00027-5

Dean, D.H. (2002). Associating the corporation with a charitable event through

sponsorship: measuring the effects on corporate community relations, Journal of

Advertising, 16(4), 77-87. doi: https://doi.org/10.1080/00913367.2002.10673687

Das, A., & Khan, H.U. (2016). Security behaviors of smartphone users, Information and

Computer Security, 24(1), 116-134. doi: https://doi.org/10.1108/ics-04-2015-0018

Ejike, A.C., Khan, H.U., & Fournier-Bonilla, S.D. (2016). Possible impact of mobile

banking on traditional banking: A case study of Nigeria, Proceedings of the Northeast

Decision Sciences Institute Conference, Alexandria, Virginia, USA, March 31 - April 2,

2016.

Erfan Najmi, E., Hashmi, K., Malik, Z., Rezgui, A., & Khan, H.U. (2015). CAPRA: A

comprehensive approach to product ranking using customer reviews, Computing, 97(8),

843-867. doi: https://doi.org/10.1007/s00607-015-0439-8

Ellison, N.B., Steinfield, C., & Lampe, C. (2007). The benefits of Facebook “friends”:

Social capital and college students' use of online social network sites, Journal of

Computer-Mediated Communication, 12(4),1143–1168.

doi: https://doi.org/10.1111/j.1083-6101.2007.00367.x

Evans, M.H. (2000). Mergers & acquisitions – Excellence in financial management,

Course 7, parts 1 and 2. From: http://www.exinfm.com

Fornell, C.R. & Larcker, F.F. (1981). Evaluating structural equation models with

unobservable variables and measurement error, Journal of Marketing Research, 18(3),

39-51. doi: https://doi.org/10.2307/3151312

http://www.exinfm.com/




Fernández-Sabiote, E. & Roman, S. (2012). Adding clicks to bricks: A study of the

consequences on customer loyalty in a service context, Electronic Commerce Research

and Applications,11(1), 36–48. doi: https://doi.org/10.1016/j.elerap.2011.07.007

Faisal, M.N., & Khan, H.U. (2016). A structural analysis of the enablers of u-commerce

proliferation in a developing economy, International Journal of Productivity and

Performance Management, 65(7), 925-946.

doi: https://doi.org/10.1108/ijppm-10-2014-0162

Gorsuch, R.L. (1983). Factor Analysis (2nd ed.), Hillsdale, NJ: Lawrence Erlbaum.

doi: https://doi.org/10.4324/9780203781098

Gill, M.S., & Dawra, J. (2010). Evaluating Aaker's sources of brand equity and the

mediating role of brand image, Journal of Targeting, Measurement and Analysis for

Marketing, 18(3-4), 189-198. doi: http://dx.doi.org/10.1057/jt.2010.11

Hakala, U., Svensson, J., & Vincze, Z. (2012). Consumer-based brand equity and top-of-

mind awareness: A cross-country analysis, The Journal of Product and Brand

Management, 21(6), 439-451. doi: http://dx.doi.org/10.1108/10610421211264928

Halabi, A.E., Hachem, A., Al-Akhrass, L., Artail, H. & Khan, H.U. (2014). Identifying

the linkability between web servers for enhanced Internet computing, 17th IEEE

Mediterranean Electrotechnical Conference MELECON 2014, 13-16 April, Beirut,

Lebanon. doi: https://doi.org/10.1109/melcon.2014.6820521

Hamzah, Z.L., Alwi, S.F.S., & Othman, M.N. (2014). Designing corporate brand

experience in an online context: A qualitative insight, Journal of Business Research,

67(11), 22-99.

Hartnett, M. (1998). Shopper needs must be priority, Discount Store News, 3: 21-22.

Hassan, I.M., Khan, HU, Zaitun, R., & Mardini, G. (2015a). Pedagogical potentials of

IEEE 802.11 WLAN to Nigerian universities: A case study of the University of Uyo,

International Journal of Information and Education Technology, 6(4), p. 256-261.

doi: https://doi.org/10.7763/ijiet.2016.v6.696

Hassan, I. M., Khan, H.U., Zaitun, R. & Mardini, G. (2015b). Pedagogical potentials of

IEEE 802.11 WLAN to higher educational institutions: A case study of Nigerian based

universities, Proceedings of the IEEE 9th International Conference on Semantic

Computing (IEEE ICSC 2015), Anaheim, CA, USA, February 7-9, 2015.

doi: https://doi.org/10.1109/icosc.2015.7050799

http://dx.doi.org/10.1057/jt.2010.11

http://dx.doi.org/10.1108/10610421211264928

Awan, Ho & Khan 33


Heang, J.F., & Khan, H.U. (2015). The role of Internet marketing in the development of

agricultural industry: A case study of China, Journal of Internet Commerce, 14(1), 1-49.

doi: https://doi.org/10.1080/15332861.2015.1011569

Ho, H.C., Awan, M.A., & Khan, H.U. (2016). Luxury brands and corporate responsibility:

A perspective on consumers’ preferences, Journal of International Management Studies,

16(1), 77-81. doi: https://doi.org/10.18374/jims-16-1.9

Hossein, R.D., & Zeinab, A. (2011). Determinants of the brand equity in the food industry

in Iran, Interdisciplinary Journal of Contemporary Research in Business, 3(6), 839-847.

Huang, P-Y., Wang, C-C., Tseng, Y-Y., & Wang, R-J. (2011). The impact of brand equity

on customer's purchase intention – Taking perceived value as a moderating variable,

Journal of Information and Optimization Sciences, 32(3), 657-672.

doi: https://doi.org/10.1080/02522667.2011.10700078

Huang, R., & Sarigollu, E. (2012). How brand awareness relates to market outcome, brand

equity, and the marketing mix, Journal of Business Research, 65: 92-99.

doi: https://doi.org/10.1016/j.jbusres.2011.02.003

Keller, K.L. (1993). Conceptualizing, measuring, and managing customer-based brand

equity, Journal of Marketing, 57(1), 1-22. doi: https://doi.org/10.2307/1252054

Keller, K.L. (2008). Strategic Brand Management: Building, Measuring, and Managing

Brand Equity. 3rd ed. Upper Saddle River, NJ: Prentice Hall.

Keller, K.L. (2013). Strategic Brand Management: Building, Measuring, and Managing

Brand Equity 4th ed., Upper Saddle River, NJ: Prentice Hall.

Kerin, R.A., Hartley, S. & Rudelius, W. (2015). Marketing, 12th ed. New York, NY:

McGraw-Hill Education.

Khan, H.U. (2012). Computer mediated communication, Quality of learning, and

performance, Journal of GSTF Business Review, 1(3), 81-88.

Khan, H.U. (2013a). Use of e-learning tools to solve group work problems in higher

education: A case study of Gulf countries, Advances in Computer Science: An

International Journal, 2(3), 90-96.

Khan, H.U. (2013b). Role of computer mediated communication in affect empowerment

and performance improvement, International Journal of Computing, 3(3), 165-171.

Khan, H.U. (2016). Possible effect of video lecture capture technology on the cognitive

empowerment of higher education students: A case study of Gulf-based university,

International Journal of Innovation and Learning, 20(1), 68: 84.

https://doi.org/10.1016/j.jbusres.2011.02.003




Khan, H.U., Ahmed, S., & Abdollahian, M. (2013). Supply chain technology acceptance,

adoption, and possible challenges: A case study of service organizations of Saudi Arabia,

10th International Conference on Information Technology: New Generations, ITNG

2013, IEEE Conference, Las Vegas, Nevada, USA, April 15-17, 2013.

doi: https://doi.org/10.1109/itng.2013.75

Khan, H.U., & Alhusseini, A. (2015). Optimized web design in the Saudi culture, IEEE

Science and Information Conference 2015, London, UK, July 28-30, 2015.

doi: https://doi.org/10.1504/ijil.2016.076672

Khan, H.U., Artail, H., Malik, Z. & Niazi, M. (2014). Information technology adoption,

possible challenges, and framework of supply chain management: A case study of a

leading Gulf economy, 4th International Conference on Engineering Technology and

Technopreneurship, Kuala Lumpur, Malaysia.

doi: https://doi.org/10.1109/ice2t.2014.7006207

Khan, H.U., Awan, M.A., & Ho. H.C. (2014). How do Chinese and Saudi customers

perceive online service quality? A comparative study, The Journal of Business Inquiry,

13(2), 142-157.

Khan, H.U., & Ejike, A.C. (2017). An assessment of the impact of mobile banking on

traditional banking in Nigeria, International Journal of Business Excellence, 11(4),

446:463. doi: https://doi.org/10.1504/ijbex.2017.10003308

Khan, H.U., & Faisal, M.N. (2014). A grey based approach for ERP vendor selection in

small and medium enterprises in Qatar, International Journal of Business Information

Systems, 19(4), 465-488. doi: https://doi.org/10.1504/ijbis.2015.070205

Khan, H.U., & Fournier-Bonilla, S.D. (2016). Technological infrastructure effects on

export diversification: A case study of Qatar, Proceedings of the Northeast Decision

Sciences Institute Conference, Alexandria, Virginia, USA, March 31–April 2, 2016.

Khan, H.U., Fournier-Bonilla, S. D., Jinugu, A., & Madhavi Lalitha, V.V. (2016). Possible

challenges of the successful implementation of CRM in the service sector: A case study

of Saudi Arabia, Proceedings of the Northeast Decision Sciences Institute Conference,

Alexandria, Virginia, USA, March 31–April 2, 2016.

Kim K.H., Jeon, B.J., Jung, H.S., Lu, W., & Jones, J. (2011). Effective employment brand

equity through sustainable competitive advantage, marketing strategy, and corporate

image, Journal of Business Research, 64: 1207-1211.


Awan, Ho & Khan 35


Klaus, Ph., & Maklan, S. (2013). Towards a better measure of customer experience,

International Journal of Market Research, 55(2), 227–246.

doi: https://doi.org/10.2501/ijmr-2013-021

Kumar, R.S., Dash, S., & Purwar, P.C. (2013). The nature and antecedents of brand equity

and its dimensions, Marketing Intelligence & Planning, 31(2), 141-159.

doi: https://doi.org/10.1108/02634501311312044

Lee, H-M., Lee, C-C., & Wu, C-C. (2011). Brand image strategy affects brand equity

after M&A, European Journal of Marketing, 45(7/8), 1091-1111.

doi: https://doi.org/10.1108/03090561111137624

Mergermarket. (2014). Global merger market. Retrieved November 9, 2014, from:

http://www.mergermarket.com/pdf/MergermarketTrendReport.Q12014.Global-

FinancialAdvisorLeagueTables.pdf

Microsoft. (2012). Microsoft officially welcomes Skype. Retrieved November 9, 2014:

http://news.microsoft.com/2011/10/13/microsoft-officially-welcomes-skype

Musa A., Khan, H.U., & Alshare, K. (2015). Factors influence consumers’ adoption of

mobile payment devices in Qatar, International Journal of Mobile Communications,

13(6), 670-689. doi: https://doi.org/10.1504/ijmc.2015.072100

Omonaiye, J.F., Madhavi Lalitha., Khan, H.U., Signh, R., & Fournier-Bonilla, S.D. (2015).

Ability and hurdle to provide banking online services: A case study of banking

employees in Nigeria, Proceedings of the 2015 IEEE 2nd International Conference on

Cyber Security and Cloud Computing, New York, USA, November 3-5, 2015.

doi: https://doi.org/10.1109/cscloud.2015.48

Page, C., & Lepkowska-White, E. (2002). Web equity: A framework for building

consumer value in online companies, Journal of Consumer Marketing, 19(3), 231-248.

doi: https://doi.org/10.1108/07363760210426058

Pappu, R., & Quester, P.G. (2006), Does customer satisfaction lead to improved brand

equity? An empirical examination of two categories of retail brands, Journal of Product

Brand Management, 15(1), 4-14. doi: https://doi.org/10.1108/10610420610650837

Peterson, R.A. (2001). On the use of college students in social science research insights

from a second-order meta-analysis, Journal of Consumer Research, 28(3), 450-461.

doi: https://doi.org/10.1086/323732

Petruzzellis, L. (2010). Mobile phone choice: Technology versus marketing -- The brand

effect in the Italian market, European Journal of Marketing, 44(5), 610-34.

doi: https://doi.org/10.1108/03090561011032298

http://www.mergermarket.com/pdf/MergermarketTrendReport.Q12014.Global-FinancialAdvisorLeagueTables.pdf

http://www.mergermarket.com/pdf/MergermarketTrendReport.Q12014.Global-FinancialAdvisorLeagueTables.pdf

http://news.microsoft.com/2011/10/13/microsoft-officially-welcomes-skype




Ratnatunga, J., & Ewing, M.T. (2009). An ex-ante approach to brand capability valuation,

Journal of Business Review, 62(3), 23-31.


Reuters. (2014). Facebook's WhatsApp acquisition now has price tag of $22 billion.

Retrieved November 9, 2014, from:

http://www.reuters.com/article/2014/10/06/us-facebook-whatsapp-

idUSKCN0HV1Q820141006

Rios, R.E., & Riquelme, H.E. (2010). Sources of brand equity for online companies,

Journal of Research in Interactive Marketing, 4(3), 214-240.

doi: http://dx.doi.org/10.1108/17505931011070587

Rios, R.E., & Riquelme, H.E. (2008). Brand equity for online companies, Marketing

Intelligence & Planning, 26(7), 719-742.

doi: https://doi.org/10.1108/02634500810916681

Sadek, H.H., Tantawi, P., & Redding, P. (2014). Investigating the major marketing

communication tools and their impact on building bank brand equity in the Egyptian

context - A customer perspective, The Business & Management Review, 5(1), 177 – 194.

Schweizer, L. (2005). Organization integration of acquired biotechnology companies into

pharmaceutical companies: The need for a hybrid approach, Academy of Management

Journal, 48(6), 1051-74. doi: https://doi.org/10.5465/amj.2005.19573109

Sicilia, M., Ruiz, S., & Reynolds, N. (2006). Attitude formation online: How the

consumer's need for cognition affects the relationship between attitude towards the

website and attitude towards the brand, International Journal of Market Research, 48(2),

139-154.

Simon, C.J. & Sullivan, M.W. (1993). The measurement and determinants of brand equity:

A financial approach, Marketing Science, 12(1), 28-53.

doi: https://doi.org/10.1287/mksc.12.1.28

Simonin, B.L., & Ruth, J.A. (1998). Is a company known by the company it keeps?

Assessing the spillover effects of brand alliances on consumer brand attitudes, Journal

of Marketing Research, 35(1), 30-42. doi: https://doi.org/10.2307/3151928

Smuts, R.G., Lalitha, M., & Khan, H.U. (2017). Change management guidelines that

address barriers to technology adoption in an HEI context, Proceedings of the 7th IEEE

International Advance Computing Conference, Hyderabad, India, January 5–7, 2017.

http://www.reuters.com/article/2014/10/06/us-facebook-whatsapp-idUSKCN0HV1Q820141006

http://www.reuters.com/article/2014/10/06/us-facebook-whatsapp-idUSKCN0HV1Q820141006

http://dx.doi.org/10.1108/17505931011070587

Awan, Ho & Khan 37


Stevens, C.K. (2011). Questions to consider when selecting student samples, Journal of

Supply Chain Management, 47(3), 19-21.

doi: https://doi.org/10.1111/j.1745-493x.2011.03233.x

Srivastava, R.K. (2012). The role of brand equity on merger and acquisition in the

pharmaceutical industry, Journal of Strategy and Management, 5(3),266-283.

doi: https://doi.org/10.1108/17554251211247571

Suppehellen, M., & Nysveen, H. (2001). Drivers of intention to revisit the website of

well-known companies: The role of corporate brand loyalty, International Journal of

Marketing Research, 43(3), 341-352.

Sweeney, J.C., & Soutar, G.N. (2001). Consumer perceived value: The development of a

multiple item scale, Journal of Retailing, 75(1), 77-105.

doi: https://doi.org/10.1016/s0022-4359(01)00041-0

Thompson, B. (2000). Ten commandments of structural equation modeling. In L.G.

Grimm & P.R. Yarnold (eds.), Reading and Understanding More Multivariate Statistics.

Washington, DC: American Psychological Association.

Uwemi, S., Khan, H.U., & Fournier-Bonilla, S.D. (2016). Challenges of e-commerce in

developing countries: Nigeria as case study, Proceedings of the Northeast Decision

Sciences Institute Conference, Alexandria, Virginia, USA, March 31– April 2, 2016.

Uwemi, S., & Khan, H.U. (2016). E-commerce, challenges, and developing countries,

Proceedings of the 2016 DSI Annual Meeting, Austin, TX, USA. November 19–22, 2016.

Vu, D.A., & Moisescu, O.I. (2013). Brand integration practices in mergers and acquisition,

Management & Marketing, 8(3), 403-428.

Warraich, U.A., Awais, M., Amin, A., & Parkash, R. (2014). Effect of co-branding on

brand equity, International Proceedings of Economic Development and Research, 69:

1-5.

Wiley, C., & Sisson, M. (2006). Ethics, accuracy and assumption: The use of Facebook

by students and employers. Paper presented at the Southwestern Ohio Council for Higher

Education Special Topics Forum, Dayton, OH.

Yoo, B., Donthu, N., & Lee, S. (2000). An examination of selected marketing mix

elements and brand equity, Journal of the Academy of Marketing Science, 28(3), 195-

211. doi: https://doi.org/10.1177/0092070300282002

ABOUT THE AUTHORS

http://0-search.proquest.com.mylibrary.qu.edu.qa/pubidlinkhandler/sng/pubtitle/International+Proceedings+of+Economics+Development+and+Research/$N/2027413/DocView/1521923660/fulltext/$B/1?accountid=13370

https://doi.org/10.1177/0092070300282002




Mahmood A. Awan is an associate professor at SolBridge International School of

Business, Daejeon, South Korea. He received his Ph.D. from North Central

University in Arizona, USA. He received his undergraduate from McGill University,

Montreal, and his MBA from Alabama A&M University, USA. He is also a

Chartered Marketer (CM). His research interests include Internet marketing, branding,

and e-government.. He can be contacted at [email protected]

Habib Ullah Khan is an associate professor of MIS in the Department of Accounting &

Information Systems, College of Business and Economics, Qatar University, Qatar.

He completed his Ph.D. in management information systems from Leeds

Metropolitan University, U.K. He has nearly 18 years of industry, teaching, and

research experience. His research interests include IT adoption in supply chain

management, Internet addiction, mobile commerce, computer-mediated

communication, IT outsourcing, big data, and IT security.

Han-Chiang Ho is an assistant professor at Wenzhou-Kean University, Wenzhou, China.

He received his Ph.D. in quantitative methods and business administration with a

specialization in marketing from Carlos III University of Madrid in Madrid, Spain.

His research interests include marketing strategies of gender and cross-cultural

difference and co-branding strategy.


Possible Effect of Merger and Acquisition on Brand …...4 Possible Effect of Merger and Acquisition...

Documents

Transcript of Possible Effect of Merger and Acquisition on Brand …...4 Possible Effect of Merger and Acquisition...