Author(s)

Pengzhi Xu

Corresponding Author

Pengzhi Xu

Abstract

I study college students’ perceived brand value in service and manufacturing categories by structural equation model (SEM) in information economics perspective, based on the investigation of successful multinational companies (MNCs)’ brands, take brand as a signal and analyze the differences of the brand value between service and manufacturing categories for their different degrees of information asymmetry. My definition of brand value is the value of a brand as a signal to consumers (I narrow the group to college students in this paper). My study gets some preliminary results: Only brand investment on the formation of brand consistency can it really exert effective influence to upgrade brand credibility. Consistency is more important to service category in promoting brand credibility for its higher information asymmetry. Credible brand (brand as a signal) can save information cost and elevate perceived quality of commodity or service. Moreover, it enables to increase brand value (or utility) by two paths, one is by perceived quality; another is information cost saved. The former plays a more important role in advancing brand value in manufacturing category, and the later performs better in service category. Finally, managerial advice is also proposed.

Keywords

Information asymmetry, Brand signal, Brand value