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The impact of brand awareness on customer satisfaction: A case study on BMW

The impact of brand awareness on customer satisfaction: A case study on BMW

Abstract

The existing literature on brand awareness and customer satisfaction indicate a good relationship between brand awareness and customer satisfaction. There have been many studies that show a positive relationship between brand awareness and the level of satisfaction of the customers. When the customers are aware of the good reputation of the brand, the brand is one step ahead of making those customers satisfied with the offering. In terms of importance, BMW stands in a summit position for the beginning of the company. It also has a good brand image among customers all over the world. It has stopped several times in terms of brand value in the car manufacturing industry. As a result, the researcher can argue that the reputation and brand image of BMW plays a significant role in satisfying its customers. All the above findings agree with the alternative hypothesis that says, “Brand Awareness of BMW has a significant positive impact on the satisfaction level of the customers of the company.” The question of the essay was, “What is the impact of brand awareness of BMW cars on its customer’s satisfaction?” After analysing all the findings, the question can be answered by saying that the brand awareness of BMW cars has a positive impact on the satisfaction level of the customers of the brand that also fulfil the aim of the paper.

 

1. Introduction

The topic of the essay is “An essay on the impact of brand awareness on customer satisfaction: A case study on BMW.” 

There is a good rationale for doing this investigation. The satisfaction level of customers is a central focus point of many modern business organisations currently as it is the primary driver of the companies’ revenue. According to a study by Zabkar (2010), the more a customer is satisfied with a product or service of a particular brand, the more he or she is loyal to the brand and makes a repeat purchase. Young (2006) further said that the brand awareness of customers towards the renowned brands had been a significant indicator of the satisfaction level of the customers. As a result, many investigations have been done on the relationship between customer satisfaction and brand awareness. This investigation is mainly focused on a specific brand called BMW. 

The essay aims to critically examine the impact of brand awareness on the customers of BMW. 

Aligning with this goal, the investigator has developed the question of this investigation like that “What is the impact of brand awareness of BMW cars on its customer’s satisfaction?”

The investigator has developed the following hypotheses regarding the topic of the investigation. The null hypothesis regarding the essay topic is “Brand Awareness of BMW has no impact on the satisfaction level of the customers of the company.” The alternative view regarding the essay topic is “Brand Awareness of BMW has a significant positive impact on the satisfaction level of the customers of the company.”

In terms of the process of the study, the investigator has divided the essay into five segments. In the introduction, he has stated the topic, aim, question, hypothesis, rationale, limitations, and investigation process. The existing theories, knowledge, and literature on both brand awareness and customer satisfaction have been discussed in the second phase. In the third section, he has described the findings of the brand awareness of BMW on the satisfaction level of its customers. In the next segment, he discussed the results in detail. In the last chapter, he has concluded the essay. 

There are some limitations of this essay. This is a secondary investigation. As a result, there is a possibility of misrepresentation/misinterpretation of data in the previous studies and this study. Rossiter (2008) said that the actual situation could be discovered most correctly by primary research because it works with the respondents. So, this secondary essay may not reveal the real problem right now. This research has been done on a single brand of the automobile industry. So, the findings are not generalisable.

 

2. Literature review

According to Hussein (2012), brand awareness is the identity of the brand to the customers. It refers to the degree to which the consumers or users can recognise or recall a brand. George (2007) further added that brand awareness also means the ability of the customers to identify and reconsider the key features or benefits of the product of the brand. That ultimately drives them to make a continuous repurchase of the product. Making customers aware of a brand has been a significant target of present business organisations. Peterson (2004) said that there is a positive relationship between brand awareness and brand value. He further added that highly valued brands such as Apple, Samsung, Microsoft, Toyota, etc., have a high level of awareness among the people or customers of the world. 

Creating brand awareness among the customers is a challenging task to do. According to Garga (2003), some pre-requirements make a brand well-known to the customers. A well-planned brand positioning is critical to make the product or service of the brand popular among the customers. Brand positioning mainly refers to the pricing strategy, quality of the product, promotional activities, target customers, etc. a well-established brand achieves popularity among the customers very quickly. Foyal (2005) said that an attractive and noticeable brand logo and a very specific slogan are very important tools to represent the brand among potential customers. Atif and Faiza (2014) further argued that advertising strategy is more important than brand logo or slogan. It attracts potential customers toward the product and makes them purchase the product. 

Lavidge (1960) developed the Hierarchy of Effect model to show the process from awareness to the customers’ purchase decision. The first stage, among six steps, includes the awareness of the customers regarding the product, category, or brand. This is done by advertisement or promotional activities. In the second stage, consumers develop knowledge of the brand. Next, they start to like or dislike the brand. In the fourth stage, consumers compare among the brands and select a preferred one. In the fifth stage, the customers show an eagerness to purchase the products of the brand. In the final stage, the customers make the purchase decision and acquire the product of the brand. 

Customer satisfaction is an immeasurable thing, but almost all modern business organisations are trying to measure the satisfaction level of their customers (Rosenberg, 1974). According to Foyal (2005), by the term customer satisfaction, business firms refers to the extent or degree of the satisfaction level of the customers that comes from using the product or services of the company. He further added that the more a product or service could fulfil the customers’ expectations, the more the customers are satisfied with this particular product or service. There is a positive relationship between the level of customer satisfaction and the profitability of the business firms. This is because a high level of customer satisfaction brings a high level of sales growth. 

Edvardsson (2009) said that the primary purpose of a business organisation is to capture as much market share as it can. And this market share is measured by the number of customers served by the company among the total number of customers in the industry. As a result, the business organisation takes strategies to increase the satisfaction level of the customers. According to Drew (1991), the quality of the product or service is the primary driver of customer satisfaction. But there are some other factors as well that affect the satisfaction level of the customers. A better product at a reasonable price, attractive packaging, easily accessible market, well-accepted brand name, post-purchase service, etc., are significant factors that affect the customers’ level of satisfaction. 

The importance of customer satisfaction is very crucial in the modern business world (Aleman, 2005). In most industries, the buying power of customers has increased significantly due to reasons such as a wide range of alternative products, a huge number of suppliers, a demand-driven market rather than supply-driven, etc. As a result, customers have been the main focus of the present business firms. According to the study of Brush (2009), the higher the satisfaction level of the customers, the greater the profitability of the firm. He further noticed that customer satisfaction has a multiplier effect. When a customer is satisfied with a product, he conveys the message to other friends and relatives. Those other persons then purchase the product as well, which ultimately increases the sales growth of the firm. 

Dougherty (2017) There is a good relationship between brand awareness and customer satisfaction. There have been many studies that indicate a positive relationship between brand awareness and the level of pleasure of the customers. Brucks surveyed in 2000 and showed that brand awareness is the entry point of customers to the product or services of the company or brand. That means customers make their first purchase decision based on the awareness of the brand rather than the development. He further added that an effective marketing strategy creates this awareness. Davies et al. (2003) articulated that brand image is a vital factor in creating brand awareness among the customers, and brand image have a positive correlation coefficient with customer satisfaction. They argued that a good brand image creates a good perception of the customers regarding the product or service of the brand that also makes the customers aware of the brand. They further showed that customers with positive perceptions about a brand become a loyal customer of that brand product and make a continuous purchase of the products. Brodie (2007) did another survey study on customers of a particular company and stated that when they asked, “why do you purchase the product of this brand?” the majority of the customers answered that because they are well known for the brand. The customers also responded by saying that they are also satisfied with the brand because they have all the required information on its product. 

 

3. Analysis

Nica (2017) showed that BMW ranks in the fifth position regarding the level of customer satisfaction among the hundreds of automobile brands in 2016. In some countries like India, it has earned a part of 3 in this category. BMW is well known for its premium quality automobiles, and it is one of the leading producers of premium quality cars. According to Jakrapan et al. (2015), the principal target of BMW is to make its brand well accepted among the customers by accumulating unique and best market positioning strategies. They further showed that this company believes in the better quality of products and services to attract new customers and build a long-term customer relationship. It takes strategies to keep its cars in a distinct position in the market, and customers are also willing to pay for these distinctions. So they concluded that a customer’s attitude toward a brand also affects the satisfaction level of the customer regarding the brand as well. 

Janssen et al. (2017) did research on the customers of BMW in the USA; they showed that more than 20% of the price paid for every car of BMW is given for the brand value of the company. Their survey results showed that most customers are well known for the services and qualities provided by the company. Customers believe that BMW cars are like a dream come true situation. Every year, the company spends billions of dollars making a loyal customer base where brand awareness plays a significant role. According to the study of Avery and Bergsteiner (2011), the company positions its product in terms of place, price, promotion, quality, etc., that are best suitable to the customers for purchasing a high-priced car. The responses of the customers about their satisfaction level show they are well satisfied with the products and after-sale services of the company. In the meantime, the relationship between brand awareness and customer satisfaction is significant. So they concluded that brand awareness helps increase the satisfaction level of the customers that ultimately drive the firm’s profitability upward. 

Byun (2014) did another study on BMW customers to find the impact of the brand image on its customer satisfaction level. That was primary research through a survey questionnaire. He found that the correlation coefficient between brand image and customer satisfaction level is 0.78, which is statistically significant as well. He stated that there is an inherent tendency of BMW customers to believe that the brand provides a good quality product; that’s why they are satisfied with the brand. Eileen (2015) stated that after-sale services of the company are excellent worldwide, which is a significant point of such high brand value or image. He further indicated that brand image is a vital point of brand awareness, and some people use them interchangeably. So this study ultimately concludes that brand image attracts the customer to know about the brand and a good and positive image develops a foundation for positive customer satisfaction.

 

4. Discussion

All the above findings agree with the alternative hypothesis that says, “Brand Awareness of BMW has a significant positive impact on the satisfaction level of the customers of the company.” So, the researcher can reject the null hypothesis that says, “Brand Awareness of BMW has no impact on the satisfaction level of the customers of the company.” But these findings are not generalisable for any other companies or brands as it has been done on the secondary sources, and no statistical tools have been used to test the hypothesis. The researcher has discussed the relationship between brand awareness of BMW to the customers and the satisfaction level of the brand’s customers in the following paragraphs. 

Brand awareness mainly comes from the reputation of the brand or the company. A reputed brand builds up the customers’ confidence regarding the quality or ability to fulfil the utility of the customers. As a result, customers’ attention gradually increases, ultimately spreading over many potential consumers. A good brand image can save a lot of time and effort for the buyer when making a purchase decision. Consumers utilise this benefit and become loyal customers if they are satisfied with the offering of the brand. So, when the customers are aware of the good reputation of the brand, the brand is one step ahead of making those customers satisfied with the offering. In terms of importance, BMW stands in a summit position for the beginning of the company. It also has a good brand image among customers all over the world. It has stopped several times in terms of brand value in the car manufacturing industry. As a result, the researcher can argue that the reputation and brand image of BMW plays a significant role in satisfying its customers.  

Consumers follow a systematic procedure while making a purchase decision. The more a customer is well aware of the product or services of a brand, the quicker they can make buying decisions. The more a brand is recognisable, remember-able, and retainable, the more the customers are willing to purchase the product or service of the brand. In the majority of the situations, customers follow a comparative analysis among brands rather than absolute comparison. They give more weight to the brand that is well known to all or influence groups. The influence group consists of people who affect the decision-making process of the general customers—friends, family members, relatives, favourite sportsman, etc. Primary information regarding BMW is available in the market. As a result, the buyer can make a quick decision that makes them happy and satisfied. 

The question of the essay was, “What is the impact of brand awareness of BMW cars on its customer’s satisfaction?” After analysing all the findings, he can answer the question by saying that the brand awareness of BMW cars has a positive impact on the satisfaction level of the customers of the brand that also fulfills the aim of the paper.

 

5. Conclusion

The essay aims to critically examine the impact of brand awareness on the customers of BMW. Aligning with this goal, the investigator has developed the question of this investigation like that “What is the impact of brand awareness of BMW cars on its customer’s satisfaction?” The existing literature on brand awareness and customer satisfaction indicate a good relationship between brand awareness and customer satisfaction. Brand awareness means the ability of the customers to identify and reconsider the key features or benefits of the product of the brand. That ultimately drives them to make a continuous repurchase of the product. By the term customer satisfaction, business firms refer to the extent or degree of the customers’ satisfaction level that comes from using the company’s product or services. There have been many studies that indicate a positive relationship between brand awareness and the level of satisfaction of the customers. When the customers are aware of the good reputation of the brand, the brand is one step ahead of making those customers satisfied with the offering. In terms of importance, BMW stands in a summit position for the beginning of the company. It also has a good brand image among customers all over the world. It has stopped several times in terms of brand value in the car manufacturing industry. As a result, the researcher can argue that the reputation and brand image of BMW plays a significant role in satisfying its customers. All the above findings agree with the alternative hypothesis that says, “Brand Awareness of BMW has a significant positive impact on the satisfaction level of the customers of the company.” The question of the essay was, “What is the impact of brand awareness of BMW cars on its customer’s satisfaction?” After analysing all the findings, the question can be answered by saying that the brand awareness of BMW cars has a positive impact on the satisfaction level of the customers of the brand that also fulfil the aim of the paper.

 

 

 

 

 

 

 

 

 

 

 

 

References

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