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Title: Constructing an index for brand equity : a hospital example
Authors: Wang, YC
Hsu, KC
Hsu, SH
Hsieh, JJPA
Issue Date: Jan-2011
Source: Service industries journal, Jan. 2011, v. 31, no. 2, p. 311-322
Abstract: If two hospitals are providing identical services in all respects, except for the brand name, why are customers willing to pay more for one hospital than the other? That is, the brand name is not just a name, but a name that contains value (brand equity). Brand equity is the value that the brand name endows to the product, such that consumers are willing to pay a premium price for products with the particular brand name. Accordingly, a company needs to manage its brand carefully so that its brand equity does not depreciate. Although measuring brand equity is important, managers have no brand equity index that is psychometrically robust and parsimonious enough for practice. Indeed, index construction is quite different from conventional scale development. Moreover, researchers might still be unaware of the potential appropriateness of formative indicators for operationalizing particular constructs. Towards this end, drawing on the brand equity literature and following the index construction procedure, this study creates a brand equity index for a hospital. The results reveal a parsimonious five-indicator brand equity index that can adequately capture the full domain of brand equity. This study also illustrates the differences between index construction and scale development.
Keywords: Brand equity
Brand equity index
Index construction
Scale development
Publisher: Routledge, Taylor & Francis Group
Journal: Service industries journal 
ISSN: 0264-2069
EISSN: 1743-9507
DOI: 10.1080/02642060902759145
Rights: © 2011 Taylor & Francis
This is an Accepted Manuscript of an article published by Taylor & Francis Group in Service Industries Journal on Jan 2011, available online at:
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