1. Introduction
Indonesia is the fourth country with the biggest population in the world, with a total of 271 million people, right after the US, India, and Republic of China (Department of Economic and Social Affairs Population Division, 2019). According to the population census in Indonesia, there are 74,93 million people who are included in Gen Z category, or 27,94% of all Indonesians. This massive number of people makes Indonesia a very potential market for brands and companies from various industries, including a soft drink company. In 2014, Consumption of soft drink in Indonesia increased by 48.57% each year and Indonesia is the fifth largest country globally that consumes soft drink as a substitute for mineral water and is often consumed by people aged 15-20 years (Siregar et al., 2022).
Coca Cola as one of the globally biggest carbonated drink brand entered Indonesia market since 1927, and until now Coca Cola Indonesia have more than 9 beverage brand offered in Indonesia such as Coca Cola, A&W, Fanta, Sprite, and many more.
Although being one of the oldest and biggest carbonated drink brand in Indonesia, due to the impact of the pandemic, Coca Cola Indonesia face volume and revenue declined around double digits. On the other hand, its competitor, Pepsi, was forced to quit the game and officially close its business in Indonesia per October 19, 2019, due to the end of the contract between PepsiCo and PT Anugerah Indofood Barokah (AIBM) as the distributor of the product.
From those two cases above, it can be concluded that along with business development in Indonesia, one of the most important things to do and note by each company is preserving existing consumers by understanding their behaviors sustainably. Successful marketing decision by brand or firms require an understanding of the process underlying consumer behavior (Mothersbaugh et al., 2016). Many factors will affect consumer behavior which lead to purchase decision, for example, one of the most important factors is brand image and reputation. Brand image is understood in the customers’ minds through favorability, strength, and the uniqueness of brand associations (Lin et al., 2021; Mitra & Jenamani, 2020). Firms with favorable brand reputation must be liked by customers (Prasad et al., 2019). A positive and well known image is an asset to all companies because image is the powerful purchase influencer that affect consumer perception of the company (Chang, 2020). A brand that regularly retain positive image by public would indeed receive more favorable position in the market, sustainable competitive advantage and increase market share and performance (Dam & Dam, 2021; Sondoh Jr et al., 2007).This one reason is the base for a company to strengthen their brand positioning so that a positive brand image is created and becomes consumers’ top-of-mind. Through brand image, consumers are able to recognize a brand and its quality. A positive brand image is surely can be achieved by a brand through its brand communication.
Brand communication is stated as the main element used to manage the relationship between the brand and the consumers, workers, suppliers, channel members, media, government regulations, and community (Zehir et al., 2011). In their dynamic, consumers always look for references from and believe in communities’ opinion about a product more, and in the marketing jargon, this phenomenon is often called word-of-mouth (WOM). WOM has a huge role in affecting consumers’ purchase decision making and in molding consumers’ behavior pattern (Reza Jalilvand & Samiei, 2012).
Therefore, the author will analyze how distribution of brand communication is affecting brand image mediated through electronic word of mouth on carbonated drink in Indonesia. This is interesting to look at because Indonesian Gen-Z’s behavior is hugely affected by connectivity and rapidly developing digital technology (Hinduan et al., 2020). Moreover, 90% of Gen Z in Indonesia uses smartphone daily and on an average spends 3.5 hours accessing the internet on their mobile phone daily, it’s about 13% longer than average Millennial (Hinduan et al., 2020). With that fact, is a communication campaign from a carbonated drink brand in Indonesia still relevant to creating a brand image, while their target audience is Gen-Z who look for and get their information daily from social media? This research is intended to find out how electronic word of mouth can have a role in creating a brand image for Indonesian Gen-Z.
2. Theoretical Background
The theoretical background in this research is associative network theory, theory of reasoned action and AISAS model. Associative network theory is often used in branding to identify core elements of a brand plan (Till et al., 2011). This theory is considered relevant for this research, according to (Keller, 1993) who stated that brand knowledge related to various association will automatically create more associations that are related to each other. Theory of Reasoned Action (TRA) was first introduced by Martin Fishbein and Ajzen, consisting of two factors related to personal and social influence. The personal influence in this theory refers to a behaviour that can generate an evaluation, both positive and negative, in doing an act. The social factor refers to the subjective norm or specifically one’s perception on social pressure given, to choose between doing or not doing a related act (Effendi et al., 2021).
Figure 1: AISAS Model
In this digital era, there is a communication pattern change between brand and consumers, driven by the rapid development of technology. The integrated marketing communication and cross communication approach created by Dentsu was built based on a deep study about ideas coming from consumers’ minds. This is relevant to this research because according to (Sugiyama & Andree, 2010), the AISAS model is not a linear phase. Some phases may be skipped, and some phases are possibly repeated or affecting another phase.
3. Literature Review
3.1. Brand Communication
Brand communication is the combination of all investment by an organization in all forms of media and in all types of promotional activities to support the brand, brand communication intend to deliver messages to consumers and prospect to influence their current and future behavior towards a brand (Schultz, 1998). Brand communication is the most important factor to successfully launch a new service. The key is to make the service concept tangible, especially those who are new to the world (Lawlor et al., 2016). According to (Barnes, 2001), brand communication dimension consists of four dimensions, which are event and experience, public relation and publicity, direct marketing and personal selling. In this research, the dimension used is the dimension mentioned by Barnes, but the indicator is modified with secondary data reference or referring to brand communication activity conducted by packaged carbonated drink in Indonesia.
3.2. Brand Image
According to Kotler and Keller (2020), brand image is a set of impact, idea, and belief of one on a brand. Therefore, the behavior and action of consumers are very dependent on that brand’s image. Kotler also added that brand image is a requirement of a brand, and a strong image is a perception that’s relatively consistent in a long period. An image of a brand is related with a behavior that is a belief and preference on a brand. A better brand is also a base to build a positive company image. Brand image includes the cognitive aspects such as knowledge and trust of a brand’s attributes, the consequence of using said brand, and a suitable usage situation as well as an evaluation. There’s also the affective aspect such as feelings and emotion associated with said brand. On the other hand, according to (Keller, 1993), brand image is created from several brand associations which consumers develop in their minds and can be classified into three dimensions, which are Attributes, Benefits, and Attitudes.
Although a brand image can’t be made by a company, because it’s created by the consumers, the company can still try to influence a brand image in consumers’ minds to be what the company wants to build an image to fulfill marketing needs (Keller, 1993).
3.3. Electronic Word-of-Mouth
Electronic word-of-mouth refers to each opinion from consumers to be, existing consumers, and ex consumers, either positive or negative, regarding a product or service marketed by a company, which is spread through the internet (Hennig-Thurau et al., 2004). According to (Jeong & Jang, 2011), there are several differences between traditional word-of-mouth and electronic word-of-mouth, such as traditional word-of-mouth is done face to face, while electronic word-of-mouth is done online. The advancement of technology changed face to face direct communication into cyber communication. Word-of-mouth is also done limitedly while electronic word-of-mouth has a high accessibility. Electronic word-of-mouth can reach everybody who has access to the internet. Meanwhile, electronic word-of-mouth makes it possible for websites users to develop a relationship virtually with consumers or other groups. In this research, the author is using the dimension mentioned by (Goyette et al., 2010) that divide electronic word-of-mouth into three dimensions, which are intensity, balance of opinion, and content.
4. Conceptual Framework
To test the empirical relation between variables, a conceptual framework is created by the author through references and modifications from previous research. Said conceptual framework is as followed:
Figure 2: Research Model
Variable X is brand communication variable. Variable Y is brand image. Variable Z is electronic word-of-mouth, which is intended to mediate between variable X and variable Y.
4.1. Brand Communication on Brand Image & Electronic Word-of-Mouth
The activity in a brand communication is designed and composed to convey a message from the brand to consumers or consumers-to-be, in order to influence their view and behavior towards the brand, both for now and for the future (Schultz, 1998). In previous research, it is also explained that communication has a significant role in building a brand image. Brand communication makes it possible for the company to do various activities intended to build public views and perceptions towards a brand. In previous research by Richard Chinomona, there is a fact that brand communication and brand image have an influence in getting and maintaining consumers’ brand loyalty in South Africa. In this research, it is proven that brand communication has a significant influence towards brand image. Also in this research, it is concluded that brand communication has a stronger influence compared to brand image towards brand loyalty (Chinomona, 2016). In other previous research, it is also explained how brand values that are communicated directly influence a brand image (Gómez-Rico et al., 2022). Communication is also makes it possible for the public to learn about the brand, shaping the value that can strengthen the brand image and lead to beneficial brand position in the market.
Word-of-Mouth itself is known as one of the most significant information distribution sources in marketing and communication world (Reza Jalilvand & Samiei, 2012) . Along with the development of technology, word of mouth activity also developed into electronic word of mouth. According to previous research, eWOM is seen as a communication source that has more influence than other sources like advertisement or company recommendation (Bickart & Schindler, 2001; Smith et al., 2007; Trusov et al., 2009). Therefore, brands are racing to create an interesting communication strategy in order to spark eWOM. In other research, it is shown that brand communication strategy has an influence towards eWOM mediated by variable perceived warm of the company (Andrei et al., 2017). Based on that research, hypothesis is made for this research in order to explore the influence of brand communication towards brand image and eWOM more.
H1: There is a significant influence of Brand Communication on Brand Image.
H2: There is a significant influence of Brand Communication on Electronic Word-of-Mouth.
4.2. Electronic Word-of-Mouth as the Mediator Variable
eWOM has a great impact in marketing world, one of them is its influence towards consumer’s behavior towards brand or consumer’s buying behavior (Reza Jalilvand & Samiei, 2012). Although a lot of research about eWOM’s impact has been conducted, research about eWOM’s influence towards brand image is less popular. Developed from previous research explaining that word-of-mouth became one of communication media that is stronger in attracting consumers compared to traditional communication (Braun et al., 2014), as the world evolves, word-of-mouth is now adapted into eWOM, which also becomes current information distribution medium.
In research by Samiei dan Reza (Reza Jalilvand & Samiei, 2012), it is shown that eWOM is one of the most important factors that has an impact on purchase interest and brand image on the market. In the same research, it is also explained that eWOM has a direct, significant impact on brand image and an indirect positive influence towards purchase intention mediated by brand image variable. Meanwhile in other research (Sagynbekova et al., 2021), it is stated that there is a mechanism where social media communication resulted by an organization or other users can generate an influence towards brand equity. In this research the effect of eWOM as the mediator variable has a traditional relation between social media communication and brand equity. Social media communication also has a significant influence through eWOM. That case becomes the base to make electronic word-of-mouth as the mediator variable in this research.
H3: There is a significant influence of Electronic Word-of-Mouth on Brand Image.
5. Research Methods
This research’s approach is quantitative; the benchmark being based on analysis played by statistic. Quantitative research relies primarily on the collection of quantitative data, in quantitative research different group are said to construct their different realities or perspectives and these social construction, reciprocally, influence how they “see” or understand their world and how they should act (Johnson & Chrsistensen, 2014). Neuman (2013) stated that there are three types of research procedure in quantitative approach, which are experiment, survey, and content analysis. In this research, the author used survey method that is conducted on samples as a representation of the population.
5.1. Sample & Data Collection
In this research there are two data, which are primary data and secondary data. The author used data collecting technique that is conducted by distributing questionnaires for the primary data. The distribution of said questionnaire is done by using Google Form link that was distributed through author’s personal Instagram account and social media accounts that discuss packaged food and beverage on Twitter and Instagram platform. Meanwhile, for the secondary data that is indirect, the author used previous research, such as journals, books, and articles that are published officially.
Universally, population, according to Allen (2017), it is the large group to which researcher wants to generalize the sample result. A population consist of all the objects or event of a certain type about which researchers seek knowledge or information (Johnson & Chrsistensen, 2014). Meanwhile, sample is a part of the number and characteristic of said population. From researcher observation about the sample, researchers make generalization about the population from which the sample was chosen (Allen, 2017). In this research, the sampling technique used is non-probability technique which is purposive sampling. According to (Allen, 2017), purposive sampling refers to sampling in which the participants are selected who are believed to have the most relevant knowledge or information for the study. This method is using some criteria that is established by the author to represent the population. Said criteria to determine the sample are:
1. Generation Z
The first criteria being sample must be 8 to 23 years old when filling the questionnaire.
2. Drinker of packaged carbonated drink
The second criteria being sample is a drinker or a consumer of packaged carbonated drink.
3. Live in Indonesia
The third criteria being sample must currently live in Indonesia.
After it is determined that the sample is a male or female aged 8 to 23 years old who live in Indonesia, also has or often drink packaged carbonated drink or soda, the determination of the number of samples is conducted using a formula (Lemeshow & Lwanga, 1991). This formula was chosen because the number of Indonesian Gen-Z who drink carbonated drink is unknown. The Lemeshow formula is as followed:
\(\begin{aligned}n=\frac{z^{2} p(1-p)}{d^{2}}\end{aligned}\)
n : Sample number
z : Standard value =1.96
p : Maximum estimation = 50% = 0.5
d : Alpha (0.05) or sampling error = 5%
Using the previously mentioned formula, the number of the sample would be:
\(\begin{aligned}n=\frac{1.96^{2} 0.5(1-0.5)}{0.05^{2}}\end{aligned}\)
n = 384,16
The number of samples that will be analysed in this research is 384 from rounding. The percentage of sample distribution according to the demographic and geographic is as followed:
Table 1: Sample Demographic Characteristics (N = 384)
Demographically, it is divided based on 5 main islands in Indonesia. The distribution is as followed:
Table 2: Sample Geographic Characteristics (N = 384)
6. Data Analysis & Result
This study's data were collected using a Structural Equation Model (SEM) approach to facilitate the testing of hypotheses. The SEM model consists of two primary components: the measurement and structural models. The measurement model describes the relationship between latent variables and their corresponding indicators (manifest variables), whereas the structural model describes the relationship between each latent variable.
6.1. Structural Model
This part will discuss data presentation related to several tests such as validity test, which includes convergent validity, discriminant validity, and reliability. This part will also present hypothesis test. There is one independent variable, on dependent variable, and one mediator variable in this research. The independent variable in this research is brand communication (x), while the dependent variable in this research is brand image (y). There is also a mediator variable which is (z), with the measurement model as followed:
Both validity test and hypothesis test in this research are using Partial Least Square (PLS) method. PLS (Partial Least Squares) analysis is chosen because this research is intended to evaluate a measurement model whose construction build comes from various sources. PLS is one of statistic test tools that can be used to create a construction of measurement model that develops or builds a theory (Hair Jr et al., 2014).
6.1.1. Outer Model Evaluation (Validity Test)
The criteria that have to be met so that an instrument/measurement model that is tested can be seen as valid and reliable is by looking at: 1) Outer Loading Factor score that must be > 0.7 on every indicator; 2) Composite Reliability score must be > 0.7; 3) Cronbach’s Alpha score must be > 0.8 to be categorized as (Hair et al., 2014; Hair et al., 2014). If all criteria are met, then the measurement model that is tested can be seen as valid and reliable. After the data is processed using the application Smart PLS, the result data is as followed:
Convergent validity from the measurement model with indicator can be seen from the correlation between indicator outer loading score with the variable. Individual indicator is seen as reliable if it has a correlation score above 0,7. Therefore, according to table 3. it can be concluded that all indicators in this research are reliable because they have a score above 0,7.
Table 3: Reliability and Confirmatory Analysis
Note: CR: Composite Reliability; AVE : Average Variance Extracted
The next test is composite reliability from the indicator that measures the variable. A variable is seen as reliable if the composite reliability score is above 0,70 (Hair et al., 2014).
Above diagram shows the score of composite reliability in this research. It is seen that there is no composite reliability score that is less than 0,7, even all is above 0,8.
The result of reliability test can also be strengthening with Cronbach’s Alpha. The score suggested is above 0,7 and on the table and diagram above, it is shown that Cronbach’s Alpha score for all variables are above 0,7. Referring to composite reliability score and Cronbach’s Alpha where all variables have the score above 0,7, it means that statistically, the instrument is consistent in measuring both indicators and variables measured. The results of validity and reliability test fulfil the requirement to continue to the process of inner model evaluation. The discriminant validity of variable score must be greater than other variables (Hair, Black, et al., 2014; Hair, Hult, et al., 2014). According to Table 4. the result data of discriminant validity test is shown that the discriminant validity of variable score is greater than other variable.
Table 4: Discriminant Validity
Note BC: Brand Communication, BI: Brand Image, EWOM: Electronic Word-of-Mouth
6.1.2. Inner Model Evaluation (Hypothesis Test)
Inner model scoring is evaluating the influence between variables like have been stated in this research, which is how brand communication and electronic word-of-mouth influence a brand image, and how electronic word-of-mouth’s influence in mediating brand communication and brand image variables. The first hypothesis test is to see the significance of influence of each independent brand communication variable towards the dependent variable that is brand image. Significance test is conducted by looking at coefficient parameter score, where T-Statistics score must be >1,96 for signifiance level of 5% (α = 0.05) (Hair et al., 2014).
On above table (Table 5.) , it is seen clearly that brand communication variable and word-of-mouth variable can influence brand image variable because the T-Statistic parameter score is above 1,96. It goes as well for brand communication variable that influences the electronic word-of-mouth variable. That fact can be concluded after the author did a bootstrapping on the application Smart PLS. The detail of how much direct and indirect influence between variables is as followed:
Table 5: Result of Structural Equation Model Analysis
Note BC: Brand Communication, BI: Brand Image, EWOM: Electronic Word-of-Mouth
The result of data processing with Smart PLS, according to Table 6. finds that direct and indirect influence indicate that both support that validity of hypothesis in this research. H1 which is “there is a significant influence between Brand Communication and Brand Image” is accepted with coefficient path score being above 0,141. H2 which is “there is a significant influence between Brand Communication and Electronic Word-of-Mouth” is also accepted with coefficient path score above being 0,709. It goes as well for H3 “there is a significant influence between Brand Communication and Brand Image mediated through Electronic Word-of-Mouth” is accepted with indirect effect total score being 0,118.
Table 6: Structural Model
Note: CE: Celebrity Endorsement; CL: Consumer Loyalty; IB: Impulse Buying Behavior
*Indicates Significance at 1% ( p ≤ 0.01)
7. Discussion and Implication
Carbonated drink becomes one of beverages that is largely marketed in various grocery stores in Indonesia. It also becomes a star beverage that is loved by Indonesians from various age range, including Gen-Z. Gen-Z inclines to actively use social media and the internet. This research is intended to observe how distribution of brand communication done by a carbonated drink company towards sparking eWOM and shaping a brand image to public Gen-Z in Indonesia. Although there is a lot of research about brand communication, brand image, and eWOM done, there is little research about the direct impact of brand communication on brand image shaping and eWOM as mediation variable done by carbonated drink industry. This research shows that each indicator in the research has passed the validity and reliability test. This research also has done inner model test to answer the hypothesis composed for this research. The result shows that distribution of brand communication positively and significantly influences brand image and eWOM. It also proves that brand communication has a significant influence towards brand image as big as 14,1%. Meanwhile, the total of indirect influence of brand communication towards brand image through eWOM as mediator is 25.9%. This result is aligned with previous research that found that brand communication has a bigger impact on brand image compared to brand trust (3). However, in other research conducted in wine beverage section, it is explained that elements on brand communication such as promotion and sponsorship activities have an important role in shaping brand image and brand preference. This research also explained that social media element in brand communication gives a lot of chance for brand to increase the brand preference and brand image. They gave a suggestion to companies or brands to include social media usage in daily communication activity. (Gómez-Rico et al., 2022; Schivinski & Dabrowski, 2015). Although this point has been explained in previous research, there is no similar research conducted in carbonated drink industry. Besides, through this research it is known that brand communication also indirectly influence brand image mediated by eWOM. This shows that brand communication done by a company can give an impact and trigger eWOM that later shapes its brand image.
Meanwhile, distribution brand communication has a significant influence towards electronic word-of-mouth as big as 70,9%. This impact is the biggest compared to direct influence or indirect influence between variables in this research. Brand communication activities conducted by carbonated drink brand consist of event and experience elements, public relations and publicity, direct marketing and personal selling, have a direct influence towards Indonesian Gen-Z. This result is developed from previous research that explained that brand communication has an indirect influence towards word of mouth inclination mediated by warmth perception. Through this research, we draw a deeper literature study about distribution of brand communication and eWOM, where brand communication is not only indirectly influence eWOM, but also directly and significantly influence eWOM.
The next discussion is the test result of the third hypothesis in this research. It shows that eWOM’s influence as mediation variable in this research towards brand image is as big as 16.7%. This result is supported by previous research which brought up that eWOM shows considerable influence towards brand image. Aside from that, eWOM also has an indirect influence that leads to purchase intention (Farzin & Fattahi, 2018; Reza Jalilvand & Samiei, 2012) . This shows that the result of eWOM activities done by Gen-Z consumers give an impact on the shaping of brand image of packaged carbonated drink company in Indonesia.
7. Conclusion
This study discusses how distribution of soft drink brand communication on brand image through electronic word-of-mouth in Indonesia Gen-Z. Based on the result of the analysis and discussion, it can be concluded that there is significant influence between brand communication, brand image and Electronic word-of-mouth. the findings of this study prove that brand communication have significant influence on brand image, beside brand communication also indirectly influence brand image mediated by eWOM. this finding show that brand communication done by company can trigger eWOM that later shapes its brand image. this study also find that brand communication has the biggest impact on electronic word-of-mouth.
These findings of this research provide deeper literature study about distribution of brand communication on brand image and electronic word-of-mouth as mediator, where brand communication not only directly influence the variable but also indirectly influence the variable.
8. Limitations and Future Research
This research has several limitations. This research was only conducted towards Indonesian Gen-Z. On top of that, there are still a lot of variables that can influence brand image. In addition, the sample in this research is relatively smaller in number. Those things can be used as a consideration for the next research to be able to discuss deeper on variables that can influence brand image.
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