J Bus Ethics

DOI 10.1007/s10551-013-1689-z

Antecedents of Green Brand Equity: An Integrated Approach

Pui Fong Ng Muhammad Mohsin Butt
Kok Wei Khong Fon Sim Ong

Received: 11 January 2013 / Accepted: 20 March 2013

Springer Science+Business Media Dordrecht 2013

Abstract A steady demand for green products from

concerned consumers has led companies to introduce new
product lines that match or exceed consumer environmental concerns. Nonetheless, not all the organizations
were able to achieve significant returns on their investments in green products. These failures are generally
attributed towards companies inability to overcome consumer scepticism towards the performance of functional
and green attributes of their brands to generate a positive
green image and green value in consumers mind. Therefore, the question arises that does the success in promoting
green brand image and value depend on consumer existing
perceptions about the brand quality and credibility? This
study analyzes the influence of brand perceive quality and
credibility on consumer perceptions towards a brand green
image, green value and green equity. A theoretical model
with hypothesized relationships is developed and tested to
answer these research questions. Data have been collected
from the consumers of electrical and electronic goods. The

P. F. Ng
M. M. Butt (&)
Nottingham University Business School, The University of
Nottingham Malaysia Campus, Semenyih, Selangor, Malaysia
e-mail: mohsinbutt@hotmail.com;
mohsin.butt@nottingham.edu.my
P. F. Ng
e-mail: ngpf_8989@hotmail.com
K. W. Khong
Taylors Business School, Taylors University, Subang Jaya,
Selangor, Malaysia
e-mail: kokwei.khong@taylors.edu.my
F. S. Ong
Taylors Business School, Taylors University, Subang Jaya,
Selangor, Malaysia
e-mail: fonsim.ong@taylors.edu.my

hypothesized relationships were tested with the help of

structural equation modeling procedure. The results suggest that brand perceived quality and its overall credibility
does have a significant influence on generating a greener
image, green perceive value and green brand equity.
Keywords Brand quality
Brand credibility
Green
brand image
Green brand perceive value
Green brand
equity
Structural equation modeling
Abbreviations
BQ
Brand quality
OBC
Overall brand credibility
GBI
Green brand image
GBPV Green brand perceive value
GBE
Green brand equity

Introduction
The significance of integrating green marketing into
contemporary business practices is evident by the growing
interest of marketing researchers and practitioners in
environmental issues and their impact on marketing
activities (Chamorro et al. 2009; Lee 2008; Ottman et al.
2006; Peattie and Crane 2005; Polonsky 2011). Most of the
leading organizations have responded by developing and
introducing eco-friendly products, but still facing the
challenge to overcome consumer scepticism about the
functional performance of these products and/or their green
attributes (Kalafatis et al. 1999). This is a significant
challenge considering the fact that in the recent past, claims
made by several organizations about the green attributes of
their products or services were found to be at best
ambiguous, if not overwhelmingly deceptive (Chen and

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P. F. Ng et al.

Chang 2012a, b; Kalafatis et al. 1999). Thus it appears that

organizations are facing dual challenge, one is to produce
eco-friendly products that matches if not outperform the
functional performance of conventional products and the
second is to generate positive perception towards ecofriendly branding initiatives.
To understand and address the second problem recent
research on green marketing have seen the development of
novel constructs such as green image, green trust, green
satisfaction and green brand equity (GBE) to gauge consumer-specific attitude towards the green branding initiatives (Chen 2010; Chen and Chang 2012a, b). Nonetheless
these novel green marketing constructs, only represent a
subset of consumer overall perception towards a brand and
will not be able to fully explain consumer purchasing
behaviour towards green products (Rios et al. 2006;
Mourad et al. 2012). Past research suggest that it is highly
unlikely that consumer will compromise on traditional
branding attributes such as price, quality and credibility
over the greenness of a brand (Chen and Chang 2012a, b),
as they tend to discount future environmental problems
more than other types of risks (Hendrickx and Nicolaij
2004).
Amongst these factors perceived quality and brand
credibility are thought to have most significant influences
on consumer purchasing decision (Sweeney and Swait
2008; Zeithaml 1988). Furthermore, as most of the ecofriendly products are new lines by existing brands thus it is
highly likely that consumers existing perception of that
brand will continue to shape their perceptions towards
these new product offerings that embrace the green concept. One of the possible theoretical explanations can be
drawn from associative memory network model. In marketing literature, associative memory network model is
frequently used to explain the memory structure of brand
associations in consumers mind (Chang and Chieng 2006).
In the context of green marketing, consumer general
attitude towards the environment and consumer perception
of a brands conventional performance are present as separate nodes. However, when a brand claims to offer ecofriendly attributes, these two separated nodes become part
of each other set of associations. Thus, when a consumer
thinks about environmentally friendly products, he/she may
automatically consider brands that assert claims on environmentally friendly attributes (Spry et al. 2011). On the
other hand brand signalling theory specifically helps in
explaining, why brand credibility can significantly influence consumer perception towards a brands green image,
its green perceived value and consumer-based brand
equity. Firms use brands as signals to dismantle information in a marketplace that is largely characterised with
imperfect and asymmetric information (Erdem and Swait
2004). Thus any marketing communication about new

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attributes of a brand, such as energy efficient, will be

assessed in the light of its existing credibility.
Second, the possible influence of the overall perceived
quality of a brand and brand credibility on consumer attitude towards environmentally driven marketing constructs
can also be based on the assumption that the overall attitude of consumers towards a brand could produce a Halo
effect in influencing their environmental-specific attitudes
towards a brand. The Halo effect is the influence of overall
trait impressions of an evaluation subject on the evaluation
of other traits of this subject (Oh and Ramaprasad 2003,
pp. 318). Thus, the more consumers positively evaluate the
product quality of a brand and its credibility, the greater is
the possibility that this evaluation influences their environmental-specific perceptions and attitudes towards that
brand.
In the past a great deal of emphasize was paid by
researchers on exploring the interrelationships of conventional branding constructs (such as brand product quality,
its credibility and consumer-based brand equity), compared
to that only a handful of researchers provide empirical
evidence on the validity of the interrelationships amongst
green branding constructs (Chen 2010; Chen and Chang
2012a, b). More importantly, no one before has attempted
to explore the relationships amongst conventional and
green branding constructs in a holistic framework.
This research is a first attempt that proposes a framework to explore the possible positive relationships between
conventional branding constructs (perceives quality and
brand credibility) and green branding constructs (green
brand image (GBI), green brand perceived value (GBPV)
and green band equity (GBE)).
The rest of the paper is organized as follows. First a
brief review of literature is presented, followed by a section
on research methodology and design. Lastly, the results are
discussed along with their managerial implications.

Literature Review and Hypotheses Development

The Positive Effect of Brand Perceived Quality on GBI
Perceived quality is referred as the customers assessment
on the overall supremacy attributes or performances of a
brand/product with regard to its intended objectives (Aaker
and Jacobson 1994, 2001; Zeithaml 1988). Brand perceived
quality is considered as one of the important factors that
influences consumers decision making by providing them
a sound reason to prefer one brand over the other (Aaker
1991; Pappu et al. 2005). Superior brand quality generates
excellent reputation and positive brand image (Jarvinen
and Suomi 2011). Several past researchers have empirically demonstrated that brand perceive quality influence

Antecedents of Green Brand Equity

consumers willingness to pay a premium price, thus generating brand equity (Pappu and Quester 2008).
Furthermore, a brand that is known and linked with its
superior quality tend to build a positive mental image,
which in turn influences consumer attitude towards the
brand, purchase frequency and brand loyalty (Arslan and
Altuna 2010; Vranesevic and Seancec 2003; Wu et al.
2011). One can find a plethora of empirical research supporting the positive association between the perceived
quality of a brand and its image. Thus far, no research has
been conducted on the influence of perceived quality on
environmental-specific brand image.
Chen (2010, p. 309) defines GBI as a whole range of
impressions, conceptions and apprehensions towards a
brand in the customers memory which is correlated to the
sustainability and eco-friendly concerns. GBI is a subset
of the overall brand image. As the quality of a brand signals a firms ability to deliver overall supremacy and performance with regards to its intended objectives (Aaker
and Jacobson 1994, 2001), it is plausible that when a firm
proclaims to deliver environmentally friendly products, the
existing quality perceptions in consumer mind may positively influence to enhance a greener brand image. Based
on the above discussion this study proposed the following
hypothesis:
Hypothesis H1 Perceived quality of a brand is positively
associated with its GBI.
The Positive Effect of Brand Perceived Quality
on Green Brand Value
Despite the availability of numerous definitions related to
customer perceived value, it is often described as the
proportion or ratio between the brands quality and its price
(Sweeney et al. 1999; Tsai 2005). Stated differently, the
value-for-money approach is frequently used as the baseline to explicate the concept of brand perceived value
(Sweeney et al. 1999; Tsai 2005). Based on the conceptualization of Patterson and Spreng (1997), Chen and
Chang (2012a, b, p. 506), define green perceived value as a
consumers overall appraisal of the net benefit of a product
or service between what is received and what is given
based on the consumers environmental desires, sustainable expectations and green needs.
In the context of green marketing, the green attributes of
a brand are integrated with conventional value propositions
to generate consumer acceptance. Thus it is not surprising
that green products are only able to successfully capture
consumer attention when they fully integrate the non-green
aspects of consumers value considerations into their
offerings (Ottman et al. 2006). The mistake of ignoring the

conventional value propositions in green marketing can be

observed during the early days of the green marketing
era in which consumers had the tendency to reject green
products largely due to their inferior product quality
(Ottman et al. 2006). Nonetheless, organizations commitments and efforts in building better quality green products
have gradually changed the consumers misconception
towards the functionality and quality of green products
(Ottman et al. 2006). This eventually, enables some brands
to command higher price for being able to generate strong
positive perceptions towards the quality of their green
products (Ottman et al. 2006). Thus it is not only the ecofriendly attributes of a brand but also its ability to deliver
superior product quality that guarantees success. For
example, besides being energy efficient, front-loading
environmentally friendly washing machines are able to
clean the garments more thoroughly and gently in comparison to the orthodox top-loading washing machines
(Ottman et al. 2006). Thus one can argue that brand perceived quality will serve as a heuristic to influence consumer judgement about its abilities to fulfil its
environmentally friendly attributes. Therefore, this study
proposed that brand quality has a positive influence on
customers perceived green brand value.
Hypothesis H2 Perceived quality of a brand is positively
associated with its green brand value.
The Positive Effect of Perceived Quality on Brand
Credibility
Brand credibility refers to the consumers trust in a firms
abilities and expertise to deliver products/services that can
satisfy their demands (Erdem and Swait 1998; Fombrun
1996). Whilst expertise implies to the extent to which a
source holds valid assertions, trustworthiness pertains to
consumer confidence in the intent of that source to convey
legitimate contentions (Hovland et al. 1953). Past research
suggest that the quality of the products manufactured in
past serve as an indicator of the companys abilities to
introduce quality products in the future (John and Paul
1994). Thus it is necessary for the newly launched product
lines (such as in this case eco-friendly products) to have
consistent or better quality relative to the brands welldeveloped products to maintain and reinforce the trustworthiness amongst consumers (Sternthal et al. 1978). In
simple words product quality influence perceived credibility of a brand. Hence, this study hypothesized that brand
perceived quality will positively influence its credibility.
Hypothesis H3 Perceived quality of a brand is positively
associated with brand credibility.

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P. F. Ng et al.

The Positive Effect of Brand Credibility on Perceived

Green Value
According to the utility ideology, perceived value is the
perceived brand utility in relation to its risks and costs,
whereby it is simultaneously evaluated by the customers as
what is gained and what is needed to scarify in order to
obtain what has been gained (Boris et al. 2004, p. 157).
Increasing awareness amongst consumers on environmental
threats caused by electronic products has pushed companies
to incorporate eco-friendly attributes in their products to
fulfil consumers green expectations. Therefore, companies
that offer environmentally sustainable products/services
enhance green perceived value of their brands. However,
incorporating green attributes in a product may not directly
influence perceived value of a brand. According to Chen and
Chang (2012a, b), the influence of green attributes may be
mediated through its brand credibility Brand credibility can
impact on consumers brand perceived value and selection,
especially when cost of assessing the relevant information is
high (Aaker 1991). Past research suggests that higher the
credibility of a brand, the greater the perceived value will be
in the minds of consumers (Hauser and Wernerfelt 1990).
Hence, consumers perceived value increases where the
perceived risk towards a brand is weakened tremendously
(Boris et al. 2004), so long as the brands uncertainty and
information search costs can be reduced to the minimum
level (Erdem and Swait 1998). Based on the above discussion this study implies the following hypothesis:
Hypothesis H4 Brand credibility is positively associated
with green perceived value.
The Positive Effect of Brand Credibility on Brand
Green Image
In the field of green marketing, companies often face three
common difficulties, which are, low credibility, green
cynicism and uncertainty (Mendelson and Poonsky 1995).
Thus it is not surprising to note that to project an ecofriendly image companies are largely dependent on building their brand credibility. One way of building credibility
is through establishing relationships with other environmental protection bodies and groups that can enable companies to enhance their brand credibility (Coddington
1993; Mendelson and Poonsky 1995; McArthur 1994).
This is because consumers are likely to perceive and
believe those brands to be more environmentally responsible which associate their products with the environmental
protection agencies (Mendelson and Poonsky 1995).
However, leveraging on secondary association via environmental protection agencies could only be helpful in
cases where a brand has significant existing credibility in

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conventional products. In other words, when credible

brands introduce eco-friendly products, their existing
credibility could create certainty and therefore, have a
positive effect in overcoming consumer green cynicism,
making it easier to project an environmentally friendly
image. Therefore, this study proposed the following
hypothesis:
Hypothesis H5
with GBI.

Brand credibility is positively associated

The Positive Effect of Brand Credibility on GBE

In general, the concept of brand equity stems from
Farquhars (1989) viewpoint, in which brand equity is outlined as the barometer to determine the degree of value
added or accumulated by a brand to a product or service.
Brand equity is a relative construct as it can only be evaluated, when comparisons are made with rival brands (Lassar
et al. 1995; Yoo et al. 2000). Aaker (1996) refers brand
equity as the assets or liabilities which are associated to the
name, term, logo or emblem of a brand, whereby it may
enhance or depreciate the value that are generated by a
good or/and service to the companies brands or customers
(p. 103). Based on Aakers (1991) definition of brand equity,
Chen (2010, p. 313) defines GBE as a set of brand assets
and liabilities about green commitment and environmental
concerns which are associated to the brand name, symbol
and logo that can either elevate or decrease the value given
by the eco-friendly goods and services. The main advantage
of cultivating robust GBE, in the growing environmentalconscious era is that it enables companies to achieve competitive advantages by positioning their products differently
in the market (Ailawadi and Keller 2004).
A number of past studies suggest that brand credibility
helps to differentiate renowned brands from their less
known counterparts (Aaker and Joachimsthaler 2000;
Farquhar 1989; Keller 1993). In a relatively recent attempt,
Papasolomou and Vrontis (2006) reported that stronger
brand equity prevails for those brands that exhibit higher
brand credibility. Credible brands enjoy lower information
processing costs and are associated with lower perceived
risk. Hence, they promote brand equity by enhancing their
value beyond functional aspects (Erdem and Swait 2004).
In other words, brand credibility is the central pillar around
which a firm can build and manage its brand equity (Erdem
and Swait 1998; Erdem et al. 2006; Spry et al. 2011). As
the novel construct of GBE is a subset of overall consumerbased brand equity, making it plausible to be influenced by
brand credibility in a similar way. Therefore, this study
proposes the following hypothesis.
Hypothesis H6
with GBE.

Brand credibility is positively associated

Antecedents of Green Brand Equity

The Positive Effect of GBPV on GBE

Past research suggests that consumers believe that the
consumption of eco-friendly products deliver additional
benefits as compared to the conventional products (Hartmann
and Apaolaza-Ibanez 2012). Thus, developing strong and
positive perceived customer value towards a brand is
important as it tends to strengthen the customer-based brand
equity (Kim and Kim 2004; Malik 2012). Baldauf et al.
(2003) argue that brand equity is the customers impalpable
and subjective evaluations of a brand perceived value. Thus,
consumers intention to purchase green products or services
can be enhanced when a favourable perceived value is
developed towards the green product/brand (Chen and Chang
2012a, b). Since eco-friendly electronic products are usually
priced at a premium in comparison to the conventional
electrical products, it is extremely important for the companies to ensure that along with green attributes, the functional
performance of their brands are at least equal if not better
than the conventional electrical products in the same category
to generate substantial GBE (Ottman et al. 2006).
Viewed from another perspective, when the conventional
product attributes of a green product are at par with competing brands, the environmental-friendly attributes will act
to serve as the source of additional value that could generate
consumer preference towards such brands (Hartmann and
Apaolaza-Ibanez 2012; Sriram and Forman 1993). Therefore, this study proposed that customer green perceived
value will positively influence consumer-based GBE.
Hypothesis H7

GBPV is positively associated with GBE.

The Positive Effect of GBI on GBE

Cretu and Brodie (2007) define brand image as the consumers mental visuals that illustrate a specific brand which
is related to the products produced by a company. Chen
(2010, p. 309, italics added) refers to GBI as a whole range
of impressions, conceptions and apprehensions towards a
brand in the customers memory which is correlated to the
sustainability and eco-friendly concerns. Companies pursuing green marketing strategies have incorporated consumers green and eco-friendly brand impressions into their
marketing, promotional and communication strategies. A
successful GBI can be delineated in the consumers mind,
when a brand is capable to ignite consumers green or
environmentally affirmative emotions, perceptions, attitudes and behaviours (Hsieh et al. 2004; Chen 2008).
The essential role of brand image in building brand
equity has been widely discussed in the past literature
(Aaker 1991, 1992; Faircloth et al. 2001; Keller 1993;
Martenson 2007). In a recent research, Chen (2010) finds
that GBI has a positive effect on GBE. Therefore, this

study also proposed that GBI will positively influence

consumer-based GBE.
Hypothesis H8

GBI is positively associated with GBE.

Based on the review of existing literature and proposed

hypotheses this study presents a conceptual model (Fig. 1)
that integrate perceived product quality and brand credibility with consumer perception towards green image,
green perceived value and GBE.

Data Collection and Methodology

To empirically test the proposed hypotheses a survey was
conducted amongst young and old Malaysian consumers
of electric and electronic products. Electronic and electric
products were chosen as a product category as this sector
is notoriously considered to be one of the major contributors of polluting natural environment and thus face the
brunt of stringent regulatory requirements and a steady
demand for more eco-friendly(green) products from
concerned consumers (Badgie et al. 2012; Hawari and
Hassan 2008).
A self-administered questionnaire was used to collect
data from the respondents. The questionnaire was distributed in different shopping malls to the willing participants.
The potential respondents were required to answer a
screening question. These screening questions were intended to ensure that the potential respondents have purchased
an electric or electronic product during last 6 month. A
total of 300 questionnaires were distributed, out of which
236 usable responses were obtained. Apart from standard
demographic information, all the items in the questionnaire
were measured using seven point Likert type scale (1
represents strongly disagree and 7 represents strongly
agree). The respondents were requested to keep their focal
brand in mind whilst answering the survey questions. 42 %
of the respondents were females, whilst 58 % were male.
More than 50 % of the respondents have an income of
\4,000 Malaysian ringgits a month. Most of the respondents were at least a bachelor degree (42 %), whilst 27 %
have a high school diploma and rest were having either a
master or a PhD, qualification.

Measurement of Variables
This study has adopted previously validated scales to
capture consumer perceptions towards product quality,
brand credibility, GBI, consumer green perceived value
and GBE of their focal brand. The five-item scale for brand
perceived quality was adapted from Washburn and Plank
(2002). Some of the items include (1) the brand is of high

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P. F. Ng et al.
Fig. 1 Research framework

quality; (2) the likelihood that this brand is reliable is very

high; (3) this brand must be of very good quality. Brand
credibility was measured using the six items adapted from
the work of Newell and Goldsmith (2001), which include
items such as (1) my favourite brand delivers what it
promises; (2) over time, my experiences with my favourite
brand have led me to expect it to keep its promises, no
more and no less; (3) my favourite brand has a name I can
trust. GBI (five items) and GBE (four items) were measured using items from Chen (2010). Examples of items
that were used to measure GBI include (1) the brand is
regarded as the best benchmark of environmental commitments; (2) the brand is professional about environmental reputation. GBE (four items) includes statements
such as (1) it makes sense to buy this brand instead of other
brands because of its environmental commitments, even if
they are the same. Green perceived value (four items) was
measured by the scale adopted from Chen and Chang
(2012a, b) which include items such as (1) this brands
environmental functions provide very good value for me;
(2) I purchase this brand because it has more environmental
benefit than other products. Appendix 1 shows the items
that measure the constructs.

Results
Data were analysed using Statistical Package for Social
Science (SPSS) Version 19.0 and AMOS version 18. A
series of statistical analyses were conducted to tests the
reliability, validity and proposed hypotheses. Reliability
was tested to establish the internal consistency of each
construct, exploratory factor analysis (EFA) was conducted
to examine how the factors converged, and confirmatory
factor analysis (CFA) was conducted to confirm the manifestation of variables on their respective constructs.

123

Finally, structural equation modelling was used to test the

hypothesized causal relationships between the constructs.
Reliability tests showed that the Cronbachs alpha of
GBPV was 0.736, perceived quality of brand (BQ) was
0.806, brand credibility (BC) was 0.832, GBI was 0.856
and GBE was 0.757. According to Nunnally (1978), the
threshold for acceptable internal consistency is when the
Cronbachs alpha is above 0.7. Furthermore, EFA was
conducted to understand how the factors converged when
the indicators were reduced into a set of manageable
dimensions. Using principal component analysis, with
varimax rotation five clear factors were extracted
(Table 1). The five factors solution accounted for 67.85 %
of the total variance explained for the 19 variables. The
KMO (0.818) and Bartletts Test (p \ 0.05) results implied
that the factors extracted were distinct and reliable (Hair
et al. 2006). Table 1 depicts the results of EFA.
In order to test for common method variance (CMV),
the Harmans one-factor test was used (Podsakoff et al.
2003). Of the 19 variables manifested on 5 factors, EFA
(fixed on a one-factor extraction without any rotations) was
conducted on the latter to determine the variance explained
by the single general factor extracted. Results revealed that
the single general factor only accounted for 33.35 % of
total variance explained for the 19 variables. In short, there
was no apparent general factor (Chen and Chang 2012a, b).
Therefore, the presence of CMV was not significant as the
single general factor did not represent the majority of the
variance explained (Malhotra et al. 2006).
The measurement models were established for the
respective factors using CFA. The CFA is used to establish
construct reliability and validity. In CFA, variables were
confined to their respective constructs where their correlation coefficients (with the constructs) were the highest.
Table 2 depicts the results of these tests. Based on the
results, all constructs had significant standardized

Antecedents of Green Brand Equity

Table 1 Exploratory factor
analysis

Components
1

GBPV 1

0.802

GBPV 2

0.788

GBPV 3

Table 2 Constructs showing

the manifesting variables, k,
reliability coefficients and
AVEs

0.685

GBE 3

0.760

6.70

GBPV

8.06

GBE

0.803

BC 1

0.781

BC 2

0.879

BC 3

0.844

BC 4

0.462

BC 5
GBI 1

0.716

GBI 2

0.804

GBI 3

0.844

GBI 4

0.808

10.08

BC

33.92

GBI

8.79

BQ

0.490

BQ 2

0.562

BQ 3

0.729

BQ 4

0.853

BQ 5

0.814

Constructs

Variables

Cronbachs
alpha

Composite
reliability

AVE

BQ

BQ2

0.656**

0.806

0.8194

0.5370

BQ3

0.631**

BQ4

0.914**
0.736

0.7495

0.5063

0.832

0.8352

0.5186

0.856

0.8610

0.6110

0.757

0.7352

0.5053

GBPV

BC

GBI

GBE

** p \ 0.05

Constructs
labels

0.687

GBE 2
GBE 4

Factor loadings below 0.46 were

suppressed. Extraction method
principal component analysis.
Rotation method varimax with
Kaiser normalization

Variance
explained (%)

BQ5

0.697**

GBP1

0.556**

GBP2

0.806**

GBP3

0.617**

BC1

0.799**

BC2

0.910**

BC3

0.816**

BC4
BC5

0.552**
0.492**

GBI1

0.622**

GBI2

0.768**

GBI3

0.899**

GBI4

0.846**

GBE1

0.718**

GBE2

0.732**

GBE3

0.683**

regression weights (k) loaded on their respective factor.

The high shared variance of the variables with the constructs were represented in the composite reliability and
average variance extracted (AVE). The acceptable

thresholds level for these two tests is values [0.7 and 0.5,
respectively (Chen and Chang 2012a, b; Yap and Khong
2006). All constructs met these thresholds except for
GBPV which marginally failed the AVE threshold.

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P. F. Ng et al.
Table 3 Discriminant validity test amongst constructs
Constructs

GBPV

GBPV

GBE

0.463

GBE

BC

GBI

BQ

(0.712, 0.711)
BC
GBI
BQ

0.422

0.319

(0. 712, 0. 720)

(0. 711, 0. 720)

0.336

0.484

0.430

(0. 712, 0. 782)

(0. 711, 0. 782)

(0.720, 0. 782)

0.355

0.355

0.439

0.443

(0. 712, 0.733)

(0. 711, 0.733)

(0. 720, 0.733)

(0. 782, 0.733)

1
1

Values in bracket indicates square root of the AVEs of respective constructs, with upper values indicating the correlations

Nonetheless, the construct met the composite reliability

threshold and therefore qualified for further analyses.
In assessing the validity of the constructs, the Fornell
and Larckers (1981) measure of discriminant validity was
used. Based on this measure, correlation between constructs must not be greater than the square root of the
constructs AVE. Table 3 shows the results of discriminant
validity tests on the pairs of five constructs. For example,
the correlation (/) between GBPV and GBE is 0.463 and
the square root of the AVEs of GBPV and GBE were 0.712
and 0.711, respectively; both AVEs were above the correlation (/ = 0.463) between them implying the presence
of discriminant validity. Based on the results presented in
Table 3, all constructs had acceptable discriminant validity. Thus, one can conclude that the constructs in this
proposed research framework (Fig. 1) are valid, reliable
and distinct from each other (Yap and Khong 2006).
As the preliminary tests results were acceptable, SEM was
conducted to test the series of hypotheses developed in the
proposed framework. This structural equation modelling
procedure was carried out using AMOS (Version 18.0). The
results indicated that the data were an excellent fit to the
proposed model. Chi square (v2) was 208.4 with 144 degree
of freedom. The RMSEA was 0.068 whilst IFI and CFI were
0.919 and 0.916, respectively. These results implied that
the model has absolute and incremental goodness of fit. The
v2/df (1.447) was between the thresholds of 1 and 2 further
indicating model parsimony. Furthermore, the residuals of
covariance were small indicating that the model could predict the variance covariance matrix. Based on the results in
Table 4, the causal relationships rooted on the series of
hypotheses were depicted. All associations were significant
(p \ 0.05) except for hypotheses H2 and H6.
Testing the Mediation Effects Using Bootstrapping
Sobel test is a common approach to test the mediations
amongst constructs. Nevertheless, this conservative

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Table 4 Hypotheses testing of the structural model

Hypothesis

p value

Results

GBI / BQ

H1

0.361

0.014**

Supported

GBPV / BQ

H2

0.180

0.101

Not supported

BC / BQ

H3

0.478

0.001**

Supported

GBPV / BC

H4

0.342

0.016**

Supported

GBI / BC

H5

0.282

0.018**

Supported

GBE / BC

H6

0.028

0.902

Not supported

GBE / GBPV

H7

0.331

0.016**

Supported

GBE / GBI

H8

0.352

0.006**

Supported

**p \ 0.05

approach in test for mediation is gradually being replaced

by SEM (Kenny 2012). Therefore, bootstrapping was used
to analyse the direct and indirect effects amongst constructs
for relatively small sample size (Zhang and Wang 2008;
Nevitt and Hancock 2001). When multiple mediations are
present in a model as shown in Fig. 1, bootstrapping
approach can be used to simultaneously test these mediations. In this paper, the simultaneous test of mediations via
bootstrapping allowed the authors to determine if mediations are independent of other mediators (Kenny 2012). As
the constructs were already tested for discriminant and
convergent validity, the mediators in Fig. 1 measured distinct hypothetical concepts. Consequently, the model is
ideal for multiple mediations test. The number of bootstrap
samples extracted was 2,000 and the bias-corrected confidence intervals were set at 95 %. The confidence intervals
implied that there should be a 95 % assurance that the
mediations amongst the respective constructs were significant. Based on the model in Fig. 1, four mediations were
tested and the bootstrap total effects of two-tailed significance results were depicted in Fig. 2. Based on the results,
GBI and GBPV (GBI and GBPV) fully mediated the
relationship between brand credibility and GBE
(BC ? GBE). Brand credibility is found to partially

Antecedents of Green Brand Equity

Fig. 2 Results of mediation
tests. ns denotes no -significance
whilst ** denotes significance at
p \ 0.05

Mediations tested

Mediations paths

Mediations results

BC GBI GBE

Full mediation

BC GBPV GBE

Full mediation

BQ BC GBI
Partial mediation

BQ BC GBPV
Full mediation

mediate the associations between brand perceived quality

and GBI (BQ ? GBI). Test of mediation for the relationship between brand perceived quality and GBPV
showed the full mediation effect of brand credibility
(BQ ? GBPV), similarly, brand perceived credibility also
fully mediate the relationship between brand perceived
quality and GBPV (BQ ? GBPV).

Conclusion and Implications

Although recent studies have explored the relationship
amongst several green marketing constructs, this study is
the first that developed an integrated model to investigate
the relationship between conventional and green branding
constructs. The theoretical contribution of this study
towards the green marketing literature is in exploring the
direct and indirect relationships between conventional and
green branding constructs. The results of this research
suggest that perceived brand quality has a significant and
positive influence on the overall brand credibility (H3), and
GBI (H1). However, the direct relationship between perceived brand quality and GBPV was not significant (H2).
Similarly, the overall brand credibility significantly

influences green perceived value (H4) and GBI (H5) but

fails to have any significant direct effect on GBE (H6).
Thus, this study is the first to provide empirical evidence
that the existing credibility of a brand influence its claims
to deliver environmentally friendly attributes, which ultimately dictate its green value (Chen and Chang 2012a, b).
Furthermore, all the direct relationships amongst green
branding constructs were significant suggesting a positive
influence of green brand perceive value and GBI on GBE
(H7 and H8).
As the model proposed multiple mediations, thus it was
imperative to test whether the non-significant results of H2
and H6 indicates a full mediation effect. The results of
mediation test via bootstrapping procedure confirm that the
non-significant effect of perceived brand quality on GBPV
is the outcome of the full mediation effect of overall brand
credibility. Similarly, the mediation results also confirm
that the non-significant effect of brand credibility on GBE
was due to mediating role of GBI.
The results of the present study indicate substantial
empirical evidence that ignoring the importance of conventional marketing concepts could be costly to marketers
who failed to realize the importance of conventional
attributes whilst embracing green marketing initiatives.

123

P. F. Ng et al.

One can infer that the results reaffirms the conventional

thinking in green marketing area that without the provision
of core functional quality and strong brand credibility any
organizational effort to successfully attract environmentally conscious customers with green product attributes will
face difficulties (Rios, et al. 2006; Mourad et al. 2012).
The second major finding concerns the effect of conventional attributes of brand perceived quality and brand
credibility on GBI and GBPV. Brand credibility partially
mediated the relationship between brand perceived quality
and GBI and fully mediates between brand perceived
quality and GBPV. Thus, for brands to build strong ecofriendly image, delivering core functional quality and
building brand credibility are relevant in shaping and
building GBI.
Several implications can be drawn from the results of
this study. First, this study provides empirical evidence that
there exist a relationship amongst conventional branding
constructs and recently developed green marketing constructs. Thus, organizations with established credibility and
excellent brand perceived quality have every possibility to
leverage their success in getting a significant share of green
markets. Second, it is also evident from the results that
creating a greener image helps brand to build GBE. This
type of brand equity can play a vital role in differentiating a
green brand from its competitors. Furthermore, when a firm

integrates green marketing approach in its overall business

strategy, it stimulates a culture of innovation to incorporate
new attributes into products. This may help them to
achieve breakthroughs that could lead to the developments
of an entirely new market.
These results should be interpreted whilst considering
their limitations. First of all this study is based on a single
industry, i.e., the electric and electronic consumer goods
sector. Future studies may consider multiple sectors to
support the generalizability of these results. Second, we did
not incorporate consumers general attitude towards the
environment that might be able to test for differences
between consumers with strong environmental concerns
with those who were less concerned about environmental
issues. Future studies could also explore the implicit
motivations for preference towards green products using
qualitative approach such as projective techniques or laddering. Based on these methods, new dimensions of why
and how consumers consume green products can be
determined.

Appendix
See Table 5

Table 5 Measurement of variables

Items
Brand perceived
quality

Washburn and Plank

(2002)

BQ1

The brand is of high quality

BQ2

The likely quality of this brand is extremely high.

BQ3

The likelihood that this brand would be functional is very high.

BQ4

The likelihood that this brand is reliable is very high.

BQ5

This brand must be of very good quality.

Brand credibility

Newell and
Goldsmith (2001)

BC1

My favourite brand delivers what it promises.

BC2

Service claims from my favourite brand are believable.

BC3

Over time, my experiences with my favourite brand have led me to expect it to keep its promises, no
more and no less

BC4

My favourite brand is committed to delivering on its claim, no more and no less.

BC5

My favourite brand has a name I can trust.

BC6

My favourite brand has the ability to deliver what it promises.

GBI
GBI1

Chen (2010)
The brand is regarded as the best benchmark of environmental commitments.

GBI2

The brand is professional about environmental reputation.

GBI3

The brand is well established about environmental concern.

GBI4

The brand is trustworthy about environmental promises.

Green perceived
value

123

Source

Chen and Chang

(2012a, b)

Antecedents of Green Brand Equity

Table 5 continued
Items

Source

GPV1

This brands environmental functions provide very good value for me.

GPV2

This brands environmental performance meets my expectations.

GPV3

I purchase this brand because it is environmental friendly.

GPV4

I purchase this brand because it has more environmental benefit than other products.

GBE

Chen and Chang

(2012a, b)

GBE1

It makes sense to buy this brand instead of other brands because of its environmental commitments,
even if they are the same.

GBE2

Even if another brand has the same environmental features as this brand, I would prefer to buy this
brand

GBE3

If there is another brands environmental performances as good as this brands, I prefer to buy this
brand

GBE4

If the environmental concern of another brand is not different from that of this brand in any way, it
seems smarter to purchase this brand

Items in italics were dropped from further analysis due to low factor loadings

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