Brands are recognised as crucial marketplace assets and therefore key sources of firm value. For this value to be realised, however, consumers must purchase and display a sustained preference for brands over time. Drawing on information economics, brand signaling theory represents a dominant view of how brands impact on purchase consideration and consumer choice. According to brand signaling theory, the credibility and quality of a brand act as powerful signals, lowering search costs and risk, and in tum, impacting purchase consideration and choice. This offers a behavioural explanation for consumers actions in the marketplace, however, there may be additional underlying processes. An alternative explanation of consumer preference and choice is based on social identity theory. According to this theoretical perspective, consumers make choices of particular brands to signal a desired social identity to others. Essentially, purchases of particular brands help to satisfy a consumer's search for meaning and need for community. However, these perspectives have not been integrated.
This thesis has two main aims, namely the integration of two perspectives which converge on the question of why consumers form preference for certain brands, and to design a test the integrative framework in multiple consumer contexts. An integrative framework is developed that encompasses both the brand signaling and social identification perspectives. To provide a comprehensive test of the model, both a field survey and experiment were conducted. These methods allowed the differential effects of mediating variables, drawn from the different theoretical perspectives, to be modelled. Path analysis with latent variables and field survey data was used to test the hypotheses drawn from the conceptual framework. Subsequently, the hypotheses were examined using logistic regression and data from a choice experiment administered via survey.
Core findings are that credibility is the main antecedent impacting the mediator variables studied (i.e., information costs saved and personal meaning). The brand signaling perspective was essentially supported, with information costs saved strongly impacting on many of the outcome variables. Additionally, the social identification perspective contributes to the explanation of the outcome variables (i.e., loyalty, communication and defence behaviour), through a crucial predictor, personal meaning. Results suggest both perspectives contribute to the explanation of brand preference. The integrated framework was supported overall, suggesting that the combination of the two perspectives provides a comprehensive explanation of consumer brand preference. The integrative framework developed in this thesis extends both the brand signaling and social identification literatures and further research may lead to important practical implications regarding marketing communication.