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African Journal of Business Management Vol.6 (25), pp. 7548-7556, 27 June, 2012 Available online at http://www.academicjournals.org/AJBM DOI: 10.5897/AJBM11.

1294 ISSN 1993-8233 2012 Academic Journals

Full Length Research Paper

The investigation and analysis impact of brand image in Iran


Shahram Gilaninia1* and Seyyed Javad Mousavian2
1

Department of industrial management, Rasht Branch, Islamic Azad University, Rasht, Iran. 2 Department of Management, Astara Branch, Islamic Azad University, Aasht, Iran.
Accepted 12 September, 2011

Brand is a powerful tool to attract more consumers to buy particular products. Some may even regarded it as equity as it can add values to the products. The objective of this paper is to conduct a study of brand image and provide recommendations for brand image enhancement after theoretical analysis of brand image on sales. This research has been done as a comparison between the products of Samsung and LG in Iran with respect to their brand image such that the following questions arise: Does the brand image has any impact on the fast moving consumer goods consumption of different companies? Does brand image affects consumer behavior? For this research, questionnaire was used. Brand image can be reinforced by brand communications, such as packaging, advertising, promotion, customer service, word-of-mouth and other aspects of the brand experience. This will also be seen having different kind of questions in questionnaire to cover as many aspects of brand image. The results show that, there were more users of LG Products as compared to Samsung with advertising, customer satisfaction and innovation positively correlated with brand image. Key words: LG, Samsung, brand, image, customer satisfaction. INTRODUCTION It is necessary to control and manage brand image continuously, which is one of the most important components of brand. Understanding a brand image is of key importance to long-term management of a brand. It is also important how the consumers formed the brand and what kind of relationship was formed with the brand? What the brand means to them and how they have accepted it. How it affects sales of different organizations. The image basically expresses the way a consumer thinks about the brand and the feelings the brand stimulates when the consumer thinks about it. On the basis of these characteristics, which the consumer associates with the brand, the company can build a competitive advantage for its brand. Kotler (2000) contends that brand is a name, term, symbol, design or all that has been mentioned, and is used to distinguish ones products and services from competitors. The brand itself, does not ensure the competitive advantage of the company in the market. Good results are achieved just by those companies which are capable of managing their brands. The conception of brand image combines the identification of brand image with intangible assets of the company that needs to be managed in order to use it efficiently. This research would distinguish the factors determining brand image, as a product comparison of Samsung and LG in Iran. In this research brand image is dependent variable while advertising, customer satisfaction and innovation are independent variables. Brand image can be positioned in consumers mind through advertising that can be aggressive for the product which is in introductory phase. When the customer gets satisfied from the product, there would be positive words of mouth and that would improve brands image. Innovation improves the brand, attracts the

*Corresponding author. E-mail: gilani_sh45@yahoo.com. Tel: +989113356977.

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customer and also helps in customer retention which improves brand image too. Innovation in a certain product or company helps building stronger customer base that helps in getting more market shares leading to better brand image. For a product, a comparison was made on refrigerator and television brands of both companies to see the effects of independent variables on dependant variable. This kind of research has previously not been conducted in Iran, and as such the research is broader in terms of selection of products and can be beneficial for the Samsung and LG in Iran. The two refrigerator brands for comparison are side by side which is of Samsung and side by side which is of LG and the two television brands are plasma which is of LG and plasma which is the product of Samsung. The American Customer Service Index (ACSI) is the first U.S. economic indicator to measure customer satisfaction. Fornell (1992) acknowledges this growth and importance by rating customer satisfaction with the goods and services of 200 companies. Brand perceptions are important because they are said to influence consideration and evaluation, and purchase (Nedungadi, 1990; Keller, 1993). Marketing activities are undertaken with the aim of changing or reinforcing the consumers mindset in some way. This includes; thoughts, feelings, experiences, images, perceptions, beliefs and attitudes towards a brand (Keller and Lehmann, 2003) .Brand perceptions are attributes in consumers memory that are linked to the brand name (Keller, 1993). Conveying a brand image to a target market is a fundamental marketing activity. Communicating a brand image to a target segment has long been regarded as an important marketing activity (Gardner and Levy, 1955). A well communicated image should help establish a brand's position, insulate the brand from competition (Oxenfeldt and Swarm, 1964) and therefore enhance the brand's market performance (Shocker and Srinivasan, 1979; Wind, 1973). Positioning/repositioning strategies, though incorporating the notion of image (and indirectly sales), do not typically indicate how the image can be managed over time. Instead, short-term, market-driven factors such as current consumer needs and competitors are used as a basis for managing the brand's image/position (Aaker and Shansby, 1982). Brand, with a symbolic concept is one designed to associate the individual with a desired group, role, or self-image. Brand management has become increasingly important, given the rapid change of the global market and elevation of competition (NanHong, 2007). Brand image is established when consumers develop ideas, feelings and expectations towards certain brands as they learn, memorize and become accustomed to them (Keller, 1993). The brand becomes a strategic platform that provides the framework for the satisfaction of customers wants and needs (Urde, 1999). In an increasingly competitive marketplace, greater emphasis is placed on brand image development as the basis for consumer discrimination

(Meenaghan, 1995). It is important for firms to become more aware of customer perceptions and how customers associate brands within a total service network experience or process. Customers do not evaluate brands in isolation (Morgan et al., 2004). LITERATURE REVIEW Brand image The concept of brands emerged from the domain of consumer products and was originally considered more or less synonymous with that category. Over the years, however, marketing scholars have reappraised the traditional brand concept and widened its meaning to include corporate as well as, product brands, and recognition of the fundamental differences between these levels (Balmer and Gray, 2003). Keller (1998) defined brand elements as those trademark able devices that help to identify and differentiate the brand. Brand image includes the totality of consumers' opinions about, experiences with, and attitudes toward a company or organization and their brand as compared with that of competitors. Brand image is pivotal in apparel purchase behavior because it impacts consumers preferences and purchase intentions as well as their willingness to pay a premium price and recommend the brand to others. Market street research often measures a company's brand image by asking consumers, decision-makers, or key markets to rate the company and its competitors on factors they consider important, (Gayathari, 2007). Communicating a brand image to a target segment has long been regarded as an important marketing activity (Gardner and Levy, 1955; Grubb and Grathwhol, 1967; Moran, 1973; Reynolds and Gutman, 1984; White, 1959). The brand is viewed as a resource or more specifically, a relational market based asset that creates value or equity (Srivastava et al., 1998). In their classic paper, Gardner and Levy (1955) wrote that, the long-term success of a brand depends on marketers' abilities to select a brand meaning prior to market entry, operationalize the meaning in the form of an image, and maintain the image over time. A brand concept should be viewed as a long-term investment developed and nurtured to achieve long run competitive advantage (Whan et al., 2006). Thakor and Katsanis (1997) believed that, brand image is one of the cues in product quality evaluation, particularly when it comes to experiential brand concept-image. Brand image is often used as an extrinsic cue to make a purchase decision (Richardson et al., 1994). Monroe (1988) says that a brand with a more positive image does have the effect of lowering consumers product perception risks and increasing positive feedback from consumers. The marketing mix performs two interrelated tasks that affect the brand's image/position (and hence sales at the introductory stage).

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The role brands play in the value-adding processes that leads to creation of the customers experiences (Berry, 2000; de Chernatony and Segal-Horn, 2003; Ballantyne and Aitken, 2007). Within this perspective, the brand plays a broader role where it interfaces not just with end customers but the company, its employees and a network of stakeholders. This perspective of branding is being referred to as the service brand (Kasper et al., 2006).The first is communication of the brand image. Each element of the mix can affect the inferences consumers develop about the brand (Frey, 1961; Lindquist, 1974, 1975; Olson, 1977; Sacharow, 1982). When a particular brand image is introduced, elaborated, and fortified, the costs associated with introducing other products become lower and the time required to move from introduction to elaboration for the new products is reduced (Park et al., 2006). Customer satisfaction Customer satisfaction is a key component of competitive strategies and keeping customers happy is critical to long-term business success (Stank et al., 1997). Customer satisfaction is the customers after purchase judgment or evaluation of a specific product or service (Oliver, 1980). Customer satisfaction includes service quality, expectations, disconfirmation, performance, desires, affect and equity (Churchill and Suprenant, 1982; Glenn et al., 1998; Levesque and McDougall, 1996; Oliver, 1993; Patterson et al., 1997; Spreng et al., 1996; Szymanski and Henard, 2001). Customer satisfaction is generally defined in the marketing literature as the discrepancy between a customers expectations and perceptions (Oliver, 1997). Satisfaction is generally viewed as an encounter-specific construct (Bitner, 1990). Consumers usually go through confirmation of need, research prior to purchase, and product evaluation to make a purchase decision, and the last is a particularly important factor. Due to the fact that, there are always risks within any purchase decision, consumers rely on product information or cues to lower the risks. Consumers generally believe they can make a satisfying purchase by choosing well-known brands and also lower any purchase risks by doing so (Nan-Hong, 2007). Customer satisfaction is an important theoretical and practical issue for most marketers and consumer researchers (Westbrook, 1980; Dabholkar et al., 1996; Goode and Moutinho, 1996; Patterson, 1993; Spreng et al., 1996; Fournier and Mick, 1999; Meuter et al., 2000). When a service failure occurs, the organizations response has the potential to either restore customer satisfaction or reinforce loyalty (Smith et al., 1999). Satisfaction with a purchased product and/or a service is a fundamental goal for consumers. Rogelberg and Creamer (1994) have suggested that customer service satisfaction significantly impacts subsequent purchase

behavior. Consumers seek to allocate monetary resources among available products and services to maximize their satisfaction. For marketers, consumer satisfaction is also a desired outcome of marketing activities. Satisfaction reinforces consumers brand and store loyalty and/or resolution to buy the product frequently (Chen-Yu and Hong, 2002). Product involvement has also been found to have a direct effect on the level of satisfaction (Richins and Bloch, 1991), as well as a mediator between mood and shopping intentions (Swinyard, 1993). Rogelberg and Creamer (1994) have suggested that customer service satisfaction significantly impacts subsequent purchase behavior. Advertising It is the paid, non-personal communication of information about products or ideas by an identified sponsor through the mass media in an effort to persuade or influence behavior (Courtland, 1987). Advertising is intended to achieve higher order communication effects in audiences opposed to the advocated position (Nelson et al., 1985). Factors such as high advertising costs and the increasing competition for shelf space, has become more difficult to succeed with new products (Aaker, 1991, 1996). One of the ultimate aims of advertising is to persuade consumers to buy certain brands over others. A classical conditioning explanation provided the theoretical rationale for the transference of effect from the ad to the brand (Shimp, 1981). To achieve this goal, many advertisers utilize advertisements with a clear conclusion (Beardi, 2001; Halliday, 2001). Advertising would continue to be influential, if advertising were also provided for the non focal brands (Sirdeshmukh, 1992). Kamins et al. (1991) found that subjects viewing a happy commercial brand evaluated it more positively on various measures of advertising effectiveness in the context of program content designed and observed to induce a happy mood. Positive advertising effects are found if the message style of the ads is in contrast with the nature of the context (Meyers et al., 1997). When companies form partnerships with a celebrity through an endorser association, they must be prepared to deal with the risks. In some cases, the decision is clear from the nature of the negative event (Louie and Carl, 2002). Involvement represents the amount of arousal or interest evoked by a particular advertisement (Mitchell, 1979). The amount of arousal or interest determines the degree of attention devoted to an advertisement and also influences the processing strategy. One processing strategy used by receivers is to actively process advertising information so as to form an overall evaluation of the advertised brand (Mitchell et al., 1980). There has been considerable debate regarding the most appropriate measures for predicting advertising effectiveness (Blair and Rosenberg, 1994; Haley, 1994; Haley and Baldinger, 1991; Harvey, 1997; Rossiter and

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Eagleson, 1994; Walker and Dubitsky, 1994). As an indication of the increasing popularity of Internet advertising, overall Web advertising revenue in the United States has grown consecutively for the past eighteen quarters with revenues for the first half of 2000 reaching $ 4.1 billion U.S. (Cyber, 2000). The function of generating attention in advertising is to increase exposure and then allow the message to influence brand awareness and ultimately consumer decision-making (Rossiter and Percy, 1997). Attracting attention alone is usually insufficient to stimulate consumer action, as much that is noted, is subsequently discarded by consumers before further processing can occur. Advertising can be viewed as a variable field created by the merged interests of communication and marketing. Variable fields grow or fade based on changing interests and concerns in society. A variable field begins when a group of scholars develop a common interest in a phenomenon and begin to systematically investigate it (Paisley, 1972). A firm can influence the perception of an extension by providing information cues through advertising and other marketing mix activities (Aaker and Keller, 1990). Advertising conditions, that is, affective reactions to an ad are likely to influence evaluations of the sponsoring brand and was significantly related to both attitude toward the brand and attitude toward purchasing the brand in advertising (Darrel, 1987).

Innovation Innovativeness is a personality trait related to an individuals receptivity to new ideas and willingness to try new practices and brands. The importance of innovativeness has been examined extensively in the literature on diffusion of innovation (Rogers, 1983) and consumer behavior (Engel et al., 1990). The results indicate that these groups of firms significantly differs with respect to both subjective and objective measures of new product performance, and with product innovation strategies and activities pertaining to timing of market entry, product quality, marketing synergy, proficiency of market launch, and management support for innovation (Atuahene-Gima and Ko, 2001). The market opportunities of firms and the development opportunities of regions depend increasingly on their capacity to continuously generate innovative products and processes (Rolf and Arndt, 2001). A common observation is that individuals high in innovativeness are more venturesome and more willing to try new brands (Stenkamp and Baumgartner, 1992). In the services sample (telecom brand), there is a positive relationship between the extent to which consumers are innovative and the extent to which services brand extensions are favorably evaluated (Hem and de Chernatony, 2001). The private value of innovation can be quite different from the private value of the intellectual property associated with that of

innovation (Sherry and Teece, 2003). Innovators differ in their ability to commercialize their innovations, and the value that the innovator can obtain from commercialization depends not only on the appropriability regime but also on the commercialization strategy that the innovator chooses (Teece, 1986). This aligns with the arguments of Keller and Aaker (1997) that an innovative corporate image leads to positive brand extension evaluations. The historic district offers competitive advantages to its constituent firms by providing a unique set of skills and resources that can constitute a distinctive local capability within a "global marketplace( Maskell and Malmberg, 1999) and by enabling the rapid circulation of information on market trends and new design innovations that are demanded by a cultural economy (Jameson, 1990; Scott, 2001). Relative product advantage is the most important product innovation characteristic. A major product advantage typically generates major market share rewards, whereas a moderate advantage generates moderate rewards (Robinson, 1990). Highly innovation-supportive cultures are credited with fostering teamwork and promoting risk-taking and creative actions that seem directly linked to effective new product development (Jassawalla and Sashittal, 2002). The need for organizational innovation and renewal has been recognized, not only to withstand the gales of creative destruction,' but also to create them (Schumpeter's, 1942). Product innovation have been recognized as a primary means of corporate renewal (Dougherty, 1992), and as an 'engine of renewal' (Bowen et al., 1994).
DATA COLLECTION METHODS The data was collected from the consumers of Tehran, Guilan, Isfahan, Tabriz, Mashhad and Kish. It took a couple of months to gather up the entire questionnaire back although, they were 250 in numbers. The respondents should have gotten enough time to fill up the questionnaire such that they only provide the absolute information which can be very fruitful for the research. The questionnaire was made by having questions relating to independent variables which were advertising, customer satisfaction and innovation and their effect has been seen on the dependant variable that is brand image. Likert scale was being used in the questionnaire. There were generally 250 respondents, out of which 57% were females and 43% were male respondents, data was almost collected from all the age groups but the most respondents were of the age between 20 to 30 years, were 67%, the respondents from the age 30 to 40 years were 21% and from 40 to 60 years were 12%. The respondents were mostly educated; there were 20% who were post graduates respondents, 44% were bachelors, 20% respondents has their education till high schools. The respondents which were having jobs were 56%, out of which 98 were having job tenures in between 1 to 10 years as seen in Table 1. Theoretical framework In this research, dependant variable is brand image and independent variables are advertising, customer satisfaction and innovation (Figure 1). Brand image can be directly affected by

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Table 1. Frequency distribution.

Variable Gender

Category Male Female Total 20-30 30-40 Above Total Matriculation High school Bachelor Master P.H.D Total 1-10 10-20 Above Total

Frequency 108 142 150 168 52 30 250 50 110 90 250 245 5 250

Percent 43 57 100 67 21 12 100 20 44 36 100 98 2 100

Cumulative Percent 43 100 67 88 100 20 64 100 98 100 -

Age

Qualification

Tenure

Independent variables
Advertising

Dependent variable

Customer Satisfaction

Brand Image

e
Innovation

Figure 1. Relationship between independent variables and dependent variable.

advertising as it positions the brand in the mind of the consumers, so brand image is dependent on advertising, since the initial product image has always been made by advertising. Brand image is also dependent on customer satisfaction; in other words, the more the customer would be satisfied with the product, the more positive would the words of his mouth be. It also maintains the brand image in its right position and also helps in improving brand image. Brand image is also dependent on the innovation product, as the consumer gets tired of seeing the old product, unless something new is added to the packaging of the brands shape. So innovation makes the customer more attracted towards the

products, polishes the brand image and increase customers satisfaction as well. Research hypotheses H1: The more the customer gets satisfied; the better would be the brand image. H2: Advertising and brand image has a positive relationship. H3: The more there would be product innovation; the better would be the brand Image.

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Table 2.The results of multiple regression analysis (MRA) between independent variables and dependent variable for LG Product.

Model 1

R a 0.473

R2 0.223

Adjusted R2 0.212

Model summary Std. error of the estimate 2.96997


b

F-statistic 11.79

Durbin-Watson stat 1.671

Model (Constant) Advertising innovation Customer satisfaction

Coefficients Unstandardized coefficients Std. Error 6.733 1.724 0.206 0.053 0.109 0.052 0.183 0.054

Standardized coefficients 0.273 0.144 0.220

t 3.905 3.908 2.091 3.415

Sig. 0.000 0.000 0.038 0.001

a. Predictors: (Constant), advertising, customer satisfaction, innovation; b. Dependent variable: brand image.

Table 3. The results of multiple regression analysis (MRA) between independent variables and dependent variable for SAMSUNG products.

Model 1

R 0.402a

R2 0.172

Model summary Adjusted R2 Std. Error of the estimate F-statistic 0.261 2.2387 11.23

Durbin-Watson stat 1.821

Coefficientsb Unstandardized coefficients Standardized coefficients Model Std. Error (Constant) 5.871 1.132 Advertising 0.187 0.045 0.221 innovation 0.165 0.043 0.195 Customer satisfaction 0.121 0.040 0.131

t 3.243 3.247 2.987 2.327

Sig. 0.000 0.002 0.005 0.024

a. Predictors: (Constant), advertising, customer satisfaction, innovation; b. Dependent variable: brand image.

DATA ANALYSIS The data has been analyzed with the help of correlation and regression analysis by SPSS software. It has been found that, there were more consumers of LG Products than of Samsung. Then the two products of Samsung and LG were compared to see the different factors determining brand image of which the correlation and regression analysis has been done between the dependent variable Brand image and independent variables advertising, customer satisfaction and innovation. Analysis for LG products The result of multiple regression analysis (MRA) between independent variables and dependent variable for LG is showed in Table 2. Using enter method, a significant model was obtained in which R = 0.473, Durbin-watson stat=1.671 and R2 = 0.223 meaning that, three independent variables explain 22% of dependent variables.

According to sig column, it is observed that all of the variables are significant and the model is as shown thus:
Y = 0 . 206 X
1

+ 0 . 109 X

+ 0 . 183 X

+ 6 . 73

According to beta column it can be said that, respectively, advertising has more impact or influence on brand image, variables and customer satisfaction and innovation are placed in subsequent grades. Analysis for Samsung products The result of multiple regression analysis (MRA) between independent variables and dependent variable for SAMSUNG products is showed in Table 3. Using enter method, a significant model was obtained in which R = 0.402, Durbin-watson stat=1.821 and R square = 0.402 meaning that three independent variables explain 22 percent of dependent variables. According to sig column, it is observed that all of the variables are significant and

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the model is as thus:


Y = 0 . 187 X
1

+ 0 . 165 X

+ 0 . 121 X

+ 5 . 87

According to beta column it can be said that, respectively, advertising has most impact or influence at brand image and variables innovation and customer satisfaction are placed in subsequent grades. Conclusion This study attempts to incorporate brand image effect and competition into the framework and examination of the effects of brand image on advertising, customer satisfaction and innovation. Moreover, strong links exist between consumer attitudes to an advertisement and their attitude towards the brand featured in the advertisement customer satisfaction and innovation; consumer attitude towards an advertisement and perceptions of a brand directly influence their attitude towards that brand image; perception of an advertisement indirectly influences attitude towards a brand through the consumer's attitude towards that advertisement; and attitude towards an advertisement can influence consumer attitude to a brand through the consumer's knowledge or perception of that brand image. After having the analysis, it has been found that the brand image has a positive correlation with all of the three independent variables. Brand Image is strongly and positively correlated with advertising, and some persons distinguish the psychological aspect of a brand from the experiential aspect. The psychological aspect, sometimes referred to as the brand image, is a symbolic construct created within the minds of people and consists of all the information and expectations associated with a product or service that is through advertising. Brand image and advertising, both have a positive and strong relationship with each other. There are two main reasons for this positive relation. Firstly, through advertising, the public/customers would come to know about the product and brand, while advising and encouraging the public to buy or use such brand would attract people to it and would make the brands image to become high. If you want to cater more target, attract more customers, try advertising in the local paper and then let more people know about whats going on, what is going to happen, what new things are coming, what new creating, innovation is happening. Secondly, advertising will increase the sales of any brand also increase the brand image. The aim of this article is to aware the public/customer regarding brand image and advertising and also important of these two factor on each other, how they influence each other, how advertising motivate the people to increase the brand image. People engaged in branding, seek to develop or align the expectations behind the brand experience, creating

the impression that a brand associated with a product or service has certain qualities or characteristics that make it special or unique. A brand is therefore, one of the most valuable elements in an advertising theme, as it demonstrates what the brand owner is able to offer in the marketplace. A cleverly crafted advertising campaign can be highly successful in convincing consumers to pay remarkably high prices for products which are inherently extremely cheap to make. It has been noticed that, whenever a company goes to launch a product, it starts to make the brand image of a product, position the product in the consumers mind and the product is always being aggressively advertised. So, it shows that advertising has direct and strong impact on brand image. It has also been found that brand image is positively correlated with customer satisfaction. In a competitive marketplace where businesses compete for customers, customer satisfaction is seen as a key differentiator and increasingly has become a key element of business strategy. It is correlated in such a way that when customer gets satisfied, there would be positive words of mouth from the customers and then there would be more customers attracted towards the product. It has been seen that the customers of side by side refrigerator and plasma which are the brands of LG are more satisfied rather than Samsung and plasma which are the brands of Samsung. However, it has also been seen that due to less satisfaction, LG products have more customers than Samsung products. The state of satisfaction depends on a number of both psychological and physical variables which correlate with satisfaction behaviors such as return and recommendation rate. The level of satisfaction can also vary, depending on other options the customer may have and other products against which the customer can compare the organization's products (Bart Allen, 1990). However, existing information processing suggests that consumer satisfaction process attribute information independently for brand image and compare the values. Numerous studies have stated that an customer satisfaction can influence the brand image. It has also been seen that brand image is positively and strongly correlated with innovation. The term innovation means a new way of doing something. It may refer to incremental, radical, and revolutionary changes in thinking, products, processes, or organizations. A distinction is typically made between invention, an idea made manifest, and innovation, ideas applied successfully (Mckeown, 2008). Innovation has strong impact in building a brand image, the LG products are more innovated than Samsung in Iran, the advertisements has some innovation that were innovation packaging, so, it attracted the customers and increased customer base. Amabile et al. (1996) says that All innovation begins with creative ideas. We define innovation as the successful implementation of creative ideas within an organization. In this view, creativity by individuals and

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teams is a starting point for innovation; the first is necessary but not sufficient condition for the second. It has also been seen through the results that innovation has positive and strong correlation with brand image in all the products. The study is focused on brand image impact on innovativeness. The relationship between innovativeness with brand image is very strong and the future innovation enhances competitiveness, information and brand image. Behind every great brand, lies a valuable social benefit delivered through innovation, value, choice effectiveness, taste, functionality and convenience to prosper. Businesses have to offer consumers these benefits and when they do, peoples lives improve. Without brands, there would be no point for the business to compete, invest and innovate.
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