Low Price Guarantee: Creating Brand Trust in Retailing through Mass Communication Euler Alves Brandão – Presenter Cid Gonçalves Filho Reynaldo Maia Muniz Stetik Group September 2013

INTRODUCTION Brazilian retail market has a significant role in country’s economy; only three electronic goods retailers reached revenues of US$ 12,7 Bi in 2009.

INTRODUCTION Electronic Goods Retail Market in 2003: market share Ricardo Eletro: 37 stores, 14th position in revenues ranking, US$ 60 Mi in sales

INTRODUCTION Ricardo Eletro in 2012: US$ 2,0 Bi in sales, 4th. in revenues ranking, 285 stores.

INTRODUCTION Electronic Goods Retailers are big investors in advertising

IMAGE STUDIES PERSPECTIVE Image in this paper has the sense of “the idea a person has about something, that is a mind projection concerning objects, people, situations, etc.; it is, therefore, a subjective representation about something” (SALLES, 2004); Perception is understood as “the set of psychological processes by which people recognize, organize, synthesize and provide meaning (the brain) to the sensations received from environmental stimuli (the sensory organs)” (STERNBERG, 2000).

IMAGE STUDIES PERSPECTIVE ISOMORPHISM Organizations are still becoming more homogeneous: once a field becomes well stablished, there is an inexorable push towards homogenization (DIMAGGIO & POWELL, 1983)

IMAGE STUDIES PERSPECTIVE Image do not necessarily reflects a “truth”: they are based on a subjective perception of reality and can be originated from false assumptions; Image is dealt in marketing under different perspectives, including: Store image Brand/Product image Corporate/Marketing image

IMAGE STUDIES PERSPECTIVE Image dimensions Source: Grasseli and Souki (2007) Functional Dimension Symbolic Dimension Image Cognitive Dimension Emotional Dimension

HYPOTHETICAL RESEARCH MODEL Image has a positive influence on purchase intention (HOOLEY & COOK, 1984; LEVY, 1988) Source: Authors Purchase Intention H1+ Trust Retailer Image H2+ H3+ Word of Mouth Communi-cation H4+ Perceived Value

METHODOLOGY PHASE 1 – Exploratory (qualitative) 48 detailed interviews All Social/Economic classes (ABCD) Results: outlined image dimensions, generating basis to create an image scale along with the review of previous studies PHASE 2 – Survey (quantitative) 490 interviews Results: image scale

DATA ANALYSIS

DATA ANALYSIS

EXPLICATIVE PHASE - MODEL

CONCLUSIONS “Instrumental Aspects” (price and negotiation) have a bigger impact on retailer’s image – public is relatively objective in the choice; Consumers need retailer’s endorsement assuring quality and availability of products; “Store appearance and assistance” relevance shows how image and expectations of the interaction with salespeople and retailer’s experience affects the purchase decision; Strong impacts of the image in behavioral intentions, specially in Purchase Intentions and Word-of-Mouth: these are high rates, leading to believe the scale elaborated has a reasonable nomologic validity, and its managerial use can be recommended.

CONCLUSIONS The results of this work lead us to believe that, when choosing electronics retailers, the consumer makes an internal search in his/her memory, tracking back the Image he/she has of them, which was created by previous experiences, word-of-mouth and mass communication, among other elements. Eminently instrumental in his/her analysis, the consumer establishes an objective criterion of choice, but uses subjective perceptions from the retailers to decide, which in a way, makes an interesting contrast.   In what concerns the theory, it is believed that the development of an image scale for the retail industry would be a relevant contribution, and accordingly, this study can generate a base for future studies and its validation in a broader sense. On the other hand, the image model’s test involving behavioral intentions in the retail contributes towards the understanding of the explanation of consumer’s behavior in this field.

THANK YOU! euler@stetikgroup.com.br