1. Introduction

The retailer utilized for this study operates stores located on-campus at a large Midwestern university. Senior management of the retailer is concerned about the viability of its core brand name for the future. Increased competition from established leased retail operations on campus and the influx of new businesses near the university campus combined with declining sales and profits in the core brand’s stores highlight the need for new strategy.

Since Internet usage is ubiquitous on the campus by both students and faculty who use numerous communication devices such as office PCs, laptops, tablets and smartphones to communicate, an online brand community facilitating loyal customer communications may help to strengthen the college brand’s image. Two branding strategies are currently under consideration. The first strategy involves retaining the current brand name and using it unilaterally on the campus at both the convenience store operations and all associated residence hall dining facilities. The second, involves retaining the core brand name only within academic building convenience stores while launching alternative branding as part of residence hall cafeterias and convenience store operations. The alternative branding approach will rebrand residence hall facilities with unique restaurant/convenience store names which segment and differentiate the offerings using a neighborhood retailer segmentation approach.

To determine whether an online community would benefit both the brand and students, factors influencing the websites use must be better understood prior to making a decision about the optimal branding strategy. Ultimately, management must develop an appropriate business strategy for the campus operations that favorably influences stakeholders brand perceptions, perceived value, brand involvement and attachment to the new online brand community.

The established core brand name has a long tradition on the campus and strong brand equity with its customers. In the surrounding community, several convenience store competitors have differentiated themselves from on campus brand by offering competing private label dairy and bakery products, financial services, specialty beverages, lottery ticket sales, and other retail mix variations. The campus convenience operations have similarly differentiated their operations with premium fair trade coffee, prepared meals, healthy snacks, international foods and specialty beverages. The convenience store brand’s embeddedness within the campus buildings provides customers an advantage by offering food items without having to travel to nearby stores off campus.

The competing local convenience store competitors do not currently offer an online brand community for their customers. This fact is viewed by management as a potential opportunity to harmonize brand communications while increasing the visibility of the college convenience store brand. On the other hand, management is also concerned that stakeholders will not routinely use such an online community. Support for creation of an online community requires empirical evidence that stakeholders will routinely use the site for brand communications in the absence of increased price promotions and costly website maintenance costs, primarily based on brand interest and loyalty.

Numerous Internet communities have demonstrated the power of building brand loyalty with consumers (e.g. Harley Davidson, Inc., Mercedes Benz, Apple Computer, Inc.) through equity oriented online communities. Internet brand communities typically combine both marketing messages, promotions and consumer centric communications. The value of brand communities as sources of business intelligence for marketers may include: customer reviews, personal information linked to brand consumption activities, suggestions from users to improve the brand, public relations communications, transparency, and the ability to create networks of loyal brand supporters, among others. Brand communities sponsored by retailers are inherently social in nature with communications touching on subjects ranging from consumption insights to rich data about the retailer’s products and services through online posting behavior. Consumers brand oriented discussions may contribute to a sense of community supporting pro-social behaviors, brand and service judgments and implications for managerial strategy and decision making. Communications within the online community potentially possess the power to change perceptions of a brand favorably or unfavorably based on management’s use of the data provided.

2. Literature Review

Brand is a broad term to define retailers and the physical products and services they offer to consumers. The word ‘strength’ is closely tied to brand equity and implies that the stronger a brand is in the minds of customers the greater its value [1]. Brands are sold within markets that are comprised of potential customers with varied degrees of loyalty, purchase frequency, and spending patterns.

Brand communities transcend consumers’ brick and mortar store brand experiences by allowing them to learn about and conveniently communicate information about their favorite brands from virtually anywhere via the Internet. Similar to shopping in stores, online community members may interact with people with varied degrees of familiarity and camaraderie while largely remaining anonymous. Due to this fact, communications within brand communities may help build or decrease brand equity quickly through positive brand communications or negative word of mouth effects [2]. The perceived trustworthiness or credibility of information exchanged in online brand communities is critical for dealing with the risks to brand equity. Moderating brand community communications and viewing them as real-time actionable intelligence for improving the brand experience is increasingly important in creating management strategy [3].

Consumers develop brand experiences and form opinions that govern their actions related to those brands, which may in turn influence others brand experiences through network effects. The power of negative word of mouth to decrease a brand’s strength has been demonstrated in past research [4] [5]. Researchers must better understand how online community members perceive the trustworthiness of fellow community members and how the community’s communications influence both their brand experiences and devotion to the brand. The online experience of brands will continue to develop over the next several decades as brand communications occur virtually anywhere on the planet in real-time. The proposed research question that management seeks to better understand is: “What role does deception in brand communications online have on consumers’ loyalty, perceived value (i.e. equity) and attachment to the brand?”

Brand marketing communications are critical for influencing brand perceptions, and many researchers routinely examine the factors involved in building loyalty to brands through marketing initiatives. In online brand communities, the impact of member communications and how they are interpreted by other users is a complex topic requiring further research. Factors such as perceptions of a message based on intrinsic or extrinsic brand experience which is then evaluated to supplement prior attributions is one area warranting additional research. In other words, how online brand communications influence judgments over time are not clearly understood, but are serious considerations when attempting to maintain or increase a brand’s perceived equity among consumers [6]. Consumers increasingly influence the brand experience through social network communications, but little is understood about the relationship of member communication effects on brand communities as a whole. From the researcher’s perspective, the impact of how a brand community’s audience judges the trustworthiness of fellow members’ communications may directly influence the perceived value of the website, loyalty to the site and members continuing involvement in communications on the site. Research has demonstrated that a consumer’s knowledge and experience with a company’s brand can influence attitudes toward new products sold by the company [7]. Brand names have been shown to have positive effects on consumers’ perceptions of the brand quality [8]. As consumers become more familiar with brands they become more confident in the brand’s perceived value supporting their purchase decisions. Brand attitudes are favorably influenced by familiarity with the brand [9]. Management at the university retailer desires to keep the core brand front of mind for consumers while introducing differentiated residence hall brands. The management desires to explore the ability of a brand community to fill the gap from decreased locations branded with the core brand name.

Internet communities may demonstrate characteristics encountered within geographic communities, particularly with regard to diversity of members and affiliation of groups. According to theory, geographic community members demonstrate what has been labeled as a consciousness of kind [10], relating to a sense of membership within a community in which some members are included and others are excluded by individuals or groups of people. Communication within the community and how others judge those communications may have a relationship to a person’s sense of affiliation with that community. Second, communities are said to periodically engage in rituals and traditions supporting the goals of the community [11], which relate to the meanings that members understand collectively. Community members will typically act to preserve the status quo of communication norms. With regard to brands with which they have substantial experience, they may engage in communications to reduce cognitive dissonance from communications that differ from their personal brand experiences. Similarly, brand community members may advocate for brands in response to communication motivated by the desire for opinion change of members. If consistent brand experiences match a person’s intrinsic or extrinsic motivations, they may wish to ritualize their experiences and express them to others as traditions (e.g. I stop in the coffee shop for a double espresso before work and have done this for years). Moral responsibility [12] relates to the obligations members feel to do what is right represent the brand based on their knowledge and experiences. Motivations of community members may range from imperfect rationalizations of brand performance to altruistic motivations of sharing brand knowledge that potentially influences other people’s adoption or rejection of the brand. Together, these three dimensions of online communities: consciousness of kind, rituals and traditions and moral responsibility form the theory of collective customer empowerment [13]. Researchers have demonstrated that brand communities positively influence loyalty to a brand in their pioneering online brand community exploration. The relevance for retailers of empowering customers to communicate with others about brands may also benefit from increased brand involvement and attachment in addition to perceptions of value and increased loyalty.

Involvement is the basis of a consumer’s desire to seek information which enhances knowledge about a brand [14]. Involvement has been demonstrated to influence a customer’s attachment to a brand [15]. If a brand community member demonstrates involvement with a brand, we predict that loyalty and perceived value of the brand moderates trustworthy or deceptive messages within the community. Prior research has found that customers with low brand involvement showed decreased loyalty to the brand [16]. Moderating factors of involvement may include the consumer’s trust for information as credible and represented the members of the community offering the information [17].

3. Hypotheses

The proposed model is presented in Figure 1. Consumers seek and share information on the Internet about retailers, often in the form of online reviews and blog posting behaviors. Loyalty relates to repeated involvement with a brand and generally ongoing purchase behavior. The consumer’s goals for sharing information about brands may range from trustworthy to deceptive communications to enhance or attempt to diminish a brand’s reputation. Deceptive communication has been demonstrated to negatively impact loyalty and satisfaction to online retailers [18]. In online brand communities, the effect of deceptive communications by community members is similarly expected to influence brand loyalty negatively. Prior research has demonstrated that user satisfaction with an online community moderates behavioral intentions to use an online brand community and satisfaction influences loyalty to the brand community [19].

Figure 1. Conceptual Model

H1: Deceptive communication influences loyalty to the brand.

If brand community members perceive online communications as deceptive, they may reduce brand equity. People seek information about brands on the Internet with increasing frequency and technological advances such as smartphones have facilitated convenient access to brand oriented information. A consumer’s ability to differentiate credible information from deceptive information is achieved through the individual’s cognitive evaluation processes. Consumers assess brand communications by creating and combining probabilistic rankings of information accuracy [20]. Communication cues about brands may be influenced based on prior inconsistent or consistent brand experiences of users. Communications in online communities may positively or negatively influence perceptions of community users. Member evaluations of community peer communications which are then attributed to brand evaluations including the specific processes used are not clearly understood. If statements made in an online brand community are inconsistent with their reader’s perceived brand reality they must then determine their credibility and formulate explanations based on the message’s content that match their personal brand consideration set. Communication practices that are consistent with the majority of user experiences with the brand are suspected to favorably influence perceived value of the brand.

H2: Deceptive communication influences perceived value of the brand.

Consumers are inherently rational creatures that try to make sense of their world through social and environmental cues which are evaluated quickly through a limited cognitive framework [21]. With regard to brands, a consumer’s consumption behavior combines perceived brand relevance and performance. Brand experiences may confirm or differ with a consumer’s brand perceptions that are expected to impact brand loyalty collectively [22]. New information about brands must similarly be incorporated into a person’s perceived reality. Consistent trustworthy communications about brands that aligns with a person’s experience may influence perceived value and loyalty to the brand. Due to the nature of anonymity of Internet community members, the researcher suspects that member communications (i.e. trustworthy or deceptive) may moderate a consumer’s brand involvement.

H3: Trustworthy communication influences perceived loyalty to the brand.

A customer’s lifetime value to the firm has been defined as the combination of revenue and costs to generate that revenue [23]. Perceived value is described as a co-created relationship between customers and brands that attempts to measure brand equity intangibly while maintaining superior financial performance in the market [24]. A consumer’s perceived value from involvement in an online community relies on favorable attributions to brands and is distinct from management’s goals to increase brand equity and tacit knowledge necessary for driving financial performance [25]. Trustworthy communications are proposed as an antecedent to perceived value in online communities. Research involving 448 survey respondents demonstrated that trust was not the key factor in creating long term brand relationships, but honest brand communications instead played a dominant role in developing brand equity [26]. Each online communication provides community members cues to the value of the information exchange, which is then matched against the reader’s perceived reality to ensure alignment. Communications that are perceived to be trustworthy are likely to favorably influence the value of brand communications within the site in general. If communications are perceived as less trustworthy, the researcher suspects that the perceived value of the online community will be impacted negatively.

H4: Trustworthy communication influences perceived value of the brand.

Attachment to brands is moderated by loyalty that may involve evaluation of prior brand experiences that contribute to brand loyalty. Developing strong brand attachments to campus convenience stores is a challenging because customers are motivated by varied loyalty motivations. Some customers may be loyal to the campus brand because the stores are the only option from which to buy goods while on campus. Others may feel loyal to the stores because of favorite products sold, locations, or services. Still others may view the brand as a temporary purchase solution for and item they will buy elsewhere in the future. Finally, other customers may have defected from the brand due to dissatisfaction or preferred competing alternatives. Targeted and effective management communications about brands may offer the opportunity to change a consumer’s brand opinions favorably compared to competing brands. In a multi-stakeholder environment such as a college campus with many competing retailers, the goal of increasing brand attachment for customers is desirable. Effective brand communications are theorized to influence loyalty and perceived value because they match consumer brand goals. Matching the consumer’s expectations through trustworthy communications may also influence other higher order dimensions of loyalty. Higher order loyalty dimensions include brand involvement which is defined as the consumer’s tendency to more deeply understand the brand and share information about the brand with others [27]. Brand attachment is a deeper emotional connection to brands that transcends habitual decision making to consume preferred brands. Brand attached consumers may attribute human emotions to brands and take an interest in developing their relationships with them to deeper levels over time similar to human friendships [28]. Just as in human relationships, the consumer may want to understand the brand more deeply, see it improve over time, or support it when it is in distress. A brand must at a minimum remain consistent or ideally improve through co-creation from the viewpoint of loyal members of brand communities.

Prior research has explored the role of involvement in brands leading to increased loyalty [29-31]. However, loyalty as a moderator influencing the proposed higher order state of brand involvement based on communication valence (i.e. trustworthy or deceptive) has not been explored. The researcher suspects that involvement of users in an online brand community depends on loyalty that is influenced by the perceived trustworthiness of communications. Members of the community share information about the brand which is not solely derived from the brand’s marketers, and therefore may be perceived as more trustworthy to users than brand marketing communications.

Since the convenience operations are geographically isolated on a large campus, customers are loyal because there are no other convenience stores to choose from without traveling off-campus. Some customers may be loyal because the convenience operations are available and fulfill their immediate needs. Those who register at an online community and seek information about brand marketing and consumer insights must arguably possess some degree of loyalty to the brand. This loyalty can take the form of positive communications or the desire to diminish the brand when expectations are not met. Motivations to remain involved and attached to the brand after evaluating online communications suggest an indirect role of loyalty to influence attachment and involvement. The researcher suspects that brand involvement and brand attachment depends on loyalty since the campus convenience stores have higher switching costs due to geographic isolation.

H5: Loyalty moderates attachment to the brand.

H6: Loyalty moderates involvement in the brand.

Trust, emotional connections, online experiences, and responsive service have been demonstrated to contribute to perceived brand value [32]. The researchers did not examine the role of deceptive communications effects on brand value. Brand attachment is hypothesized as a dependent variable that is moderated by the interaction of trustworthy communications and perceived value of the brand. In the studied conveniences, the researcher suspects that perceived value of the brand may vary due to limited store alternatives and satisfying specific needs, however, value attributions may change over time or with repeated consumption. Consumers who participate in online communities are likely to perceive some degree of perceived brand value by reading marketing messages or consumer brand discussions. Similar to loyalty, perceived value is theorized to have an indirect effect on brand involvement and attachment based on trustworthy or deceptive communications community members read online.

H7: Perceived value moderates attachment to the brand.

The dimensions of a consumer’s brand image consist of numerous cues that contribute to a brand image [33]. Consumers’ evaluation of brand value is theorized as a preliminary cognitive state based on the interaction of trustworthy/deceptive communications and evaluations which stimulate further brand involvement. Involvement may include behaviors like talking about brands with others and advocating for brands in an online community.

H8: Perceived value moderates involvement in the brand.

4. Methods

An online survey of students of a large Midwestern university was conducted through a hosted web domain to test the hypotheses. The survey assessed the impact of a potential online community’s member communication behaviors influence on loyalty, perceived value, brand attachment, and brand involvement. The dependent variable brand involvement is the measure of communicating about the retailer’s core brand and importance to the consumer’s life. A 7-point Likert type scale was used to measure participants’ responses. Involvement, brand attachment, perceived trustworthiness, deception, loyalty and perceived value were adapted from established scales [34]. A convenience sample was collected from college students in a class setting and each student was offered extra credit for completing the survey during a two-week data collection period. No contact information was collected, and survey participants remained completely anonymous. 102 responses were received, and 98 of them were valid, indicating a response rate of 58%. The study was approved by the university’s institutional review board for human subjects research. The characteristics of the participants are shown in Table 1.

Table 1. Participant Characteristics

5. Results

The relationship of the theorized dimensions was analyzed utilizing a structural equation modeling approach in IBM SPSS and AMOS software, version 21. The measurement and structural model specifications measured the independent and dependent variables and the relationships between those variables. A seven point Likert scale with a neutral midpoint value (4) was used to measure all items. The survey took participants ten to fifteen minutes to complete after clicking the email hyperlink to the survey website and completing online informed consent documentation. Each measure used in the study was tested for internal consistency reliability using the following measures: average inter-item correlation, average item total correlation, and Cronbach’s alpha coefficients.

Confirmatory Factor Analysis

The measurement model was assessed for internal consistency using Cronbach’s alpha. The alphas for the CFA are presented in Table 2. Convergent validity is demonstrated when each of the measurement items loads with a significant value on its latent construct. Convergent validity was measured by using the standards of loadings over .50 and the average variance extracted (AVE) explained was greater than the average variance unexplained or indicated within measurement error [35]. Discriminant validity, or the measurement of how constructs differ from one another without sharing variance between several constructs, was calculated by comparing the square root of the AVE to the item to construct correlations. Discriminant validity is established when the measurement items show a suitable pattern of loadings based on theoretical assumptions of the assigned factors [36]. Factor loadings less than .7 imply that greater than 50% of the variance in an observed variable is explained by factors different from the construct to which the indicators are theoretically related [37]. The measurement items supported the proposed theoretical constructs.

The factor structure of the 27 item post-EFA scale was examined. All but two of the items correlated >.30, indicating factorability. The remaining items were retained for theory purposes. Next, the Kaiser-Meyer-Olkin measure of sampling adequacy was .83, well above the recommended value of .6. Bartlett’s test of sphericity was significant X² = 1389, p<.001. The communalities were all above .5, indicating that each item shared common variance with other items. The anti-image correlation matrix diagonals were all above .5. Given these findings, confirmatory factor analysis was a viable option for the sample.

Principal component analysis was used to examine the six factor model: deception, trustworthiness, loyalty, value, attachment, and involvement. The factor structure was examined with direct oblimin rotation, D=0. Initial Eigen values for the factor solution based on the theoretical model explained 71.62% of variance. Five of the six Eigen values explained 66% of the variance with values greater than 1.0. The final factor in the model explained approximately 6% of the variance and was retained for theoretical purposes.

Table 2. Mean, SD, Scale Reliability, AVE, and Correlations

Path Analysis

The researcher next examined the structural model using path analysis and structural equation modeling in AMOS 21. From this analysis, we hope to better understand the relationships within the formative model from each latent predictor construct influence on attachment and involvement independent of shared variance between them. All hypothesized independent variables were allowed to co-vary freely for this analysis. The fit statistics for the path model X² = 11.832, p<.106 indicate acceptable fit: GFI = .97, AGFI=.90, SRMR=.06, RMSEA=.07.

The path model tests the relevant strength of fit of the hypothesized model to the latent constructs and indirect effects of loyalty and perceived value latent constructs on the dependent latent constructs, brand attachment and brand involvement. Path coefficient values represent the strength of the correlations between the independent and dependent variables.

Figure 2. Path Analysis Diagram

Hypothesis Testing

Hypothesis one predicted that deceptive communication behaviors in the online community would influence loyalty to the brand and was supported B = -460(.120), p<.001. Hypothesis two predicted that deceptive communication behaviors in the online community would influence perceived value of the brand, and was not supported. Participants did not view the communications of community members reducing the value of the brand. Hypothesis three predicted that trustworthy communication in the online brand community would influence brand loyalty and was supported B= .202(.10), p<.05. Hypothesis four predicted that trustworthy communication by users within the brand community would influence perceived value of the brand and was supported, B = .322(.09), p<.01. Hypothesis five predicted that brand loyalty would influence brand attachment and was supported, B =.963(.085), p<.001. Hypothesis six predicted that brand loyalty would influence brand involvement and was supported, B =.753(.074), p<.001. Hypothesis seven predicted that perceived value of the brand would influence brand attachment and was not supported. There is no direct or indirect effect of communication behaviors (trustworthy or untrustworthy) on perceived brand value and brand attachment. In other words, participants were influenced more by brand loyalty than through perceived brand value. Hypothesis eight predicted that perceived value of the brand would influence brand involvement and was supported, B =.239(.078), p<.01.

Interaction Effects

The hypothesized model was tested for interaction effects. Loyalty and perceived value of the brand were suspected to moderate brand attachment and brand involvement based on trustworthy or deceptive communication practices on the site. Latent variables were converted to Z-values, and the interaction of trustworthy communication_X_loyalty and trustworthy communication_X_perceived value were transformed into two new variables. Likewise, the same process was completed for deceptive communication_X_loyalty and deceptive communication_X_perceived value and two new variables were created. The interaction effects were tested in AMOS 21, perceived value strengthens the negative relationship between misleading communications and involvement. Misleading communications about brands may spark greater desires of online community members to defend the brand to others. Loyalty strengthens the negative relationship between misleading communications and attachment. Loyalty strengthens the negative relationship between misleading communications and involvement. No moderation effects were shown between perceived value and brand attachment when community members presented misleading communications. Likewise, there was no evidence of moderation for loyalty and perceived value when community member’s communications are perceived as trustworthy.

6. Conclusions and Limitations

Arguably, in different situations for brand involvement (e.g. online or in stores) influences brand loyalty. Participants had prior experience with the university brand which likely influenced their opinions of a prospective website about the brand. Participant were also likely to evaluate the hypothetical brand community based on their real world experiences online. Participants demonstrated concern about the trustworthiness of communications in the proposed online community. The importance of trustworthy online communications is highlighted in the news media frequently. The question of interest to management was how online communications impact: loyalty, perceived value, brand attachment, and brand involvement. We found evidence that deceptive communications of online community members have a strong negative relationship on loyalty. Trustworthy communications positively impact both loyalty and perceived value. Loyalty has a strong direct relationship on brand attachment and brand involvement. Perceived brand value has a moderate influence on brand involvement. Based on the relationships discovered, management should support trustworthy communications in online communities.

Loyalty also produced interactions based on the indirect impact of deceptive communications on both brand attachment and brand involvement. Highly brand loyal customers may experience negative effects on brand attachment and loyalty when they encounter misleading online community communications. This study provides preliminary evidence community moderation may help management influence trustworthy communications through approaches like: censoring messages, content ratings systems, or controlling site membership and access. Additional research is required to determine if management moderation the current model findings.

The sample for this study was not randomly selected, and participants received an incentive to participate (i.e. extra credit). There is a risk among participants of self-selection bias not aligned with actual online usage behavior. The sample under-represented the secondary core consumer groups: faculty and graduate students representing only 3% of the total sample n=3. Future studies should seek a more balanced sampling frame. Initial focus groups exploring idiosyncratic differences among campus customers in a mixed method design could support increased generalizability of the findings. The role of customer service at the retailer was not explored in this study, and may be a significant factor in brand loyalty influencing participation in an online community.

The impact of word of mouth messages related to the retailer’s brand expressed in cyberspace anonymously may differ from those during real-world store visits or interactions with employees. Surveying consumers about the retailer’s brand or providing an opportunity to complete an online survey at the completion of a transaction in store through random selection at point of sale may help researchers understand how customers’ express opinions differently whether they are in store or online.