1. Lecture on Economic Research: Framework, Methodology, and Concrete Examples of its Application to Actual Issues Jovi C. Dacanay, Ph.D. School of Economics University of Asia and the Pacific

2. Thesis or Working Paper Writing as a Learning Experience Cutting the thesis into chunks Problem Formulation Thinking it through Skills and Competencies of an Economics Major Applications to Actual Research Work Consumer Behavior Research Economics of Film

3. What are working papers? Working Papers are pre-publication versions of academic articles, book chapters, or reviews. It could also be an edited version of a thesis or dissertation that is prepared for journal submission. Some working papers are indexed in Scopus, i.e. ADB Working Paper Series.

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5. Do we want a finished product like this? Chunks of several cakes?

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16. Policy making Analytical thinking and theory building 16

17. For the thesis, more emphasis is made on analytical thinking and empirical verification. 17

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20. Table 1. Grounding a Model of Graduate Research in Hansen’s Taxonomy of Learning Key Steps Hansen’s Proficiencies for the Economics Major Hansen’s Proficiencies for the Economics Major (as applied in the IEP) 1. Identify economic issues Accessing existing knowledge:  Locate published research in economics and related fields  Locate information on particular topics and issues in economics  Search out economic data as well as information about the meaning of data and how they are derived Asking pertinent and penetrating questions: ( RESSEM 1 & 2)  Topic Proposals Defended 2. Develop a research question Asking pertinent and penetrating questions:  Demonstrate an understanding of questions that stimulate productive discussion (factual, interpretative and evaluative) and that reflect particular concerns when engaged in discussing economic issues and policies. 3. Undertake a literature search 4. Summarize relevant literature Displaying command of existing knowledge:  Write a precis of a published journal article  Summarize in a two-minute monologue or a 300-word written statement what is known about the current condition of the economy  Summarize the principal ideas of an eminent economist  Summarize a current controversy in the economics literature  State succinctly the dimensions of a current economic policy issue  Explain key economic concepts and describe how they can be used. Displaying command of existing knowledge:  Write a critique of a published journal article  Principal ideas of the economist who authored the article to be critiqued  Current controversies in the literature are done when writing the review of related literature  Dimensions of the current economic policy issue, current condition of the economy and the key economic concepts used are all done when analyzing the macroeconomic and industry papers for research seminar 20

21. Table 1. Grounding a Model of Graduate Research in Hansen’s Taxonomy of Learning (Continued) Key Steps Hansen’s Proficiencies for the Economics Major Hansen’s Proficiencies for the Economics Major (as applied in the IEP) 4. Summarize relevant literature 5. Identify an area of potential contribution Interpreting existing knowledge:  Explain what economic concepts and principles are used in economic analyses published in articles from daily newspapers and weekly news magazines  Read and interpret a theoretical analysis, which includes simple mathematical derivations, reported in an economics journal article. Interpreting existing knowledge:  Macroeconomics, Microeconomics, Economic Policy  Done in the critique and RRL of the research papers 6. Develop evidence 7. Draw conclusions 8. Compare conclusions to identified literature 9. Apply analysis to current policy issue Applying existing knowledge:  Prepare a five-page written analysis of a current economic problem  Prepare a two-page decision memorandum for a superior that recommends some action on an economic decision faced by the organization  Write an op-ed essay on some local economic issue. Applying existing knowledge and analyzing evidence:  Analysis of the current economic problem, a policy suggestion or course of action, or an essay of a local economic issue are done forming part of the research seminar papers and the thesis  The approach done in the IEP is to do the paper in collaboration with a mentor/industry coach 21

22. Table 1. Grounding a Model of Graduate Research in Hansen’s Taxonomy of Learning (Continued) Key Steps Hansen’s Proficiencies for the Economics Major Hansen’s Proficiencies for the Economics Major (as applied in the IEP) 10. Present research to peers and/or faculty Creating new knowledge:  Identify and formulate a question or series of questions about some economic issue that will facilitate its investigation  Prepare a 5-page proposal for a research project  Complete a research study with its results contained in a carefully edited 20-page paper Creating new knowledge: (Thesis Seminar and Writing)  Identify and formulate a question or series of questions about some economic issue that will facilitate its investigation. Defend it in front of a panel  Prepare a thesis proposal of not more than 5,000 words  60-paged paper, main text Source: Replicated from a description provided in Hansen (2001). (See Hansen, W. L. (2001) “Expected Proficiencies for Undergraduate Economics Majors”, Journal of Economic Education, Vol. 32 (3), pp. 231–242, and, Mc Goldrick, Kim Marie, “Undergraduate Research in Economics,” Department of Economics, University of Richmond, Richmond, VA. Published by the Economics Network, May 2007. (Online version at http://www.economicsnetwork.ac.uk/handbook/ugresearch/ (Accessed May 27, 2010))http://www.economicsnetwork.ac.uk/handbook/ugresearch/ 22

70. Consumer-Based Brand Equity Scale for Philippine Fast Food Chain Brands The Case of Jollibee and McDonald’s Danica Leane Panganiban School of Economics University of Asia and the Pacific Thesis Defense May 2014

71. Product anything which can be presented to a market for purchase, use or consumption that satisfies need or want Brand a product that has distinguishing name and/or symbol (such as logo, trademark or package design) which differentiates it from products that satisfy the same need Brand Equity any asset or liability connected to a brand name that adds or subtract value to a product

72. Law of Supply and Demand = I N A C OMMODITY B USINESS PriceDemand I N A B RANDED B USINESS PriceDemand /

73. Brand Economics E CONOMIC M ODEL C OMMODITY P RODUCT E CONOMIC M ODEL B RANDED P RODUCT Demand Curve Moves Outward Demand increases as non-consumers begin to switch Revenue Curve Moves Outward Consumers are willing to pay more

74. Brand Economics E CONOMIC M ODEL C OMMODITY P RODUCT E CONOMIC M ODEL B RANDED P RODUCT Greater Consumer Surplus Greater Sales and Profits

75. FIES & ASPBI 20002003200620092012 Average Total Family Expenditure (in Php Billion) Total Expenditure 1,794.12,038.52,561.43,239.24,125.3 Food Expenditure 782.2878.21,059.61,380.31,765.6 Food consumed at home 692.5768.0910.61,183.91,456.2 Food consumed outside the home 89.7110.3149.1196.4 309.4 Percentage (of Total Expenditure) Total Expenditure 100.0 Food Expenditure 43.643.141.442.642.8 Food consumed at home 38.637.735.536.535.3 Food consumed outside the home 5.05.45.86.1 7.5 Growth Rate (in percent) Total Expenditure 27.013.625.726.527.4 24.0 Food Expenditure 25.312.320.730.327.9 23.3 Food consumed at home 24.110.918.630.023.0 21.3 Food consumed outside the home 35.123.035.231.757.5 36.5 Expenditure for eating-out has more than tripled from Php 89.7B in 2000 to Php 309.4B in 2012 Influx of Population Increasing working class and changing lifestyle Urbanization of families 2005 Annual Survey of Philippine Business and Industry (ASPBI) Number of restaurants, bars, canteen and other eating establishments jumped 80,000 in 2011 from 72,000 in 2007 (11% growth)

76. JFC’s Advertising and Promotion Expense Source of Raw Data: Jollibee Foods Corporation Annual Statement, 2002-2012 Note: Net Sales Per APE is defined as net sales generated for every peso expense in advertising and promotions Advertising and Promotion Expense (APE) and Net Sales Per APE of JFC JFC’s Advertising and Promotion Expense has grown to Php 1.37B in 2012, 2.5 times larger than its 570 million expenses in 2000

77. STATEMENT OF THE PROBLEM What explains the brand equity of the two leading fast food chain brands in the Philippines from the perspective of the consumers?

78. OBJECTIVES OF THE STUDY 1. To verify the prominence of Jollibee and McDonald’s brands in Philippine Fast Food Industry 2. To determine and measure the attributes critical to the development of consumer-based brand equity for Jollibee and McDonald’s Brands.

79. SIGNIFICANCE OF THE STUDY Corporations in the Philippine Fast Food Industry Directly links brand equity and consumers, and measure its sources Greater understanding of what exists in the consumers’ minds concerning brands –their opinion, feeling, beliefs, and attitudes toward brands will provide managers strategic and tactical guidance to help them make brand decisions. Marketing and Corporate Development Managers Presents a measurement technique that enables them to gain a good understanding of the depth and breadth of awareness, favorability, loyalty and uniqueness of associations for their brands

80. SCOPE AND LIMITATIONS A brand is a consumer’s idea The consumer is an active participant in the creation of equity of a brand Objective of this paper: To contribute to the current knowledge on brand equity by developing a conceptualization and scale of brand equity with respect to how consumer perceived the brand

81. Scope and Limitations Focus: Philippine Fast Food Industry or Quick Service Restaurants Jollibee and McDonald’s Rationale: Aggressive stances in developing their brands as proven by their robust marketing and advertising campaigns in television, radio, billboards and other forms of media Coverage: Metro Manila since concentration of high in the area brought about by demand from increasing number of working class and changing lifestyle of families in big cities $ 163 M4% $ 377 M9% $ 3.7 B87% $ 1 B 23 % $ 251 M 6% Source: USDA Foreign Agriculture Service Report

82. BRAND EQUITY CONCEPTUALIZATIONS AND MODELS

87. FORMULATED CONSUMER-BASED BRAND EQUITY MODEL FOR FAST FOOD CHAIN BRANDS

89. EMPIRICAL METHODOLOGY

90. 1. Boston Consulting Group Growth/Share Paradigm 2. Business Life Cycle Objective 1 Verify the prominence of Jollibee and McDonald’s brands in Philippine Fast Food Industry High Brand Equity Leadership: Higher rank in the market Market size: Higher the market size Profitability: Higher the profitability Brand must fall in a star or cash cow Srivastava (2007) identified indicators to see if a brand has high brand equity: High Brand Equity Volume business: Higher the sales (signifies brand acceptance and image) Brand must fall in a growing phase or early maturity stage

91. Objective 1 Verify the prominence of Jollibee and McDonald’s brands in Philippine Fast Food Industry 3. Experience Curve Hypothesis: Both brands are prominent in Philippines Fast Food Industry Brands with High Brand Equity BCG Matrix: Within Stars or Cash Cows BLC Graph: Late Growth Phase or Early Maturity Phase Experience Curve: Declining Marketing expense to Total Sales High Brand Equity Marketing Expense to total sales: Declining over time while profit remain high (results of having loyal customers) Srivastava (2007) identified indicators to see if a brand has high brand equity:

92. The formulated scale development framework derived from the four brand equity models presented by Aaker (1996), Keller and Lehmann (2003), Berry (2000) and Lassar et al. (1995) INSTRUMENT Structured survey questionnaire designed in accordance to the formulated conceptual framework a) 4 major constructs of brand equity b) Each construct is assigned with latent variables 4 attributes for brand loyalty 4 attributes for brand awareness 6 attributes for perceived quality 8 attributes for brand association (see Appendix 1) Objective 2 Develop a customer-based brand equity scale for fast food industry

93. Objective 2 Develop a customer-based brand equity scale for fast food industry

94. DATA COLLECTION Convenience Sampling subjects are drawn from that part of the population close to hand Periods: April 3-6, 2014 (Thursday to Sunday) from 8am-9pm Point-of-sale (POS) customer survey The respondents should meet the following criteria: (1)They make their own decision on which fast food chain they will eat (2)They are currently consuming any products of the brand within the store branch (3)They pay for their consumption of these products Objective 2 Develop a customer-based brand equity scale for fast food industry

95. MEASUREMENT Principal Component Analysis using oblimin rotation to examine the validity of brand equity structure Censored Normal (Tobit) Regression Analysis to estimate the relationship of the explanatory variables with the dependent variables Objective 2 Develop a customer-based brand equity scale for fast food industry

96. RESULTS AND DISCUSSION

97. 1.1 Boston Consulting Group Growth/Share Paradigm Objective 1 Verify the prominence of Jollibee and McDonald’s brands in Philippine Fast Food Industry Jollibee is a cash cow and McDonald’s is a star Leadership: Market Size: Profitability: Source: Company Annual Reports, 2012

98. 1.2 Business Life Cycle Objective 1 Verify the prominence of Jollibee and McDonald’s brands in Philippine Fast Food Industry Jollibee and McDonald’s fall within early stage of mature phase Jollibee McDonald’s Characterized by growing sales Stabilizing growth Source: Company Annual Reports (2001-2012)

99. 1.3 Experience Curve Objective 1 Verify the prominence of Jollibee and McDonald’s brands in Philippine Fast Food Industry Marketing expense to total sales ratio is declining Implications: Both brands expend less to keep up sales and maintain customers Source: Company Annual Reports (2001-2012)

100. A. Demographic Profile of Respondents 356 respondents are collected Objective 2 Develop a customer-based brand equity scale for fast food industry Source: Author’s Survey Results

101. A. Demographic Profile of Respondents Objective 2 Develop a customer-based brand equity scale for fast food industry Source: Author’s Survey Results

102. A. Demographic Profile of Respondents Objective 2 Develop a customer-based brand equity scale for fast food industry Source: Author’s Survey Results

103. B. Fast Food Chain Brands Patronage Habits of Respondents Objective 2 Develop a customer-based brand equity scale for fast food industry Source: Author’s Survey Results 1. Ranking of Fast Food Chain Brands 2. Average Number of Visits and Average Spending Per Visit

104. B. Fast Food Chain Brands Patronage Habits of Respondents Objective 2 Develop a customer-based brand equity scale for fast food industry Source: Author’s Survey Results (see appendix 8) 3. Reason for Choosing the Brand

105. B. Fast Food Chain Brands Patronage Habits of Respondents Objective 2 Develop a customer-based brand equity scale for fast food industry Source: Author’s Survey Results (see appendix 9) 4. Foods Regularly Consumed in Fast Food Chain

106. C. Modification of Attributes of Brand Equity (Factor Analysis) Objective 2 Develop a customer-based brand equity scale for fast food industry Source: Author’s Survey Results The value of KMO at 0.918 presents a superb and acceptable value for the reliability test of singularity problem and identity matrix problem The patterns of correlation are relatively compact and factor analysis can yield distinct and reliable results

107. C. Modification of Attributes of Brand Equity (Factor Analysis) Objective 2 Develop a customer-based brand equity scale for fast food industry Principal Component Analysis (PCA) with direct oblimin rotation Component 1: Brand Association 8 attributes (DIF, TWS, PVAL, COR, PER, ORG, ATM, SIM) Additional: LDR and FD Component 2: Brand Awareness 4 attributes (RCAL, RCOG, TMIN, KNOW) Component 3: Brand Loyalty 4 attributes (BHL, CGL, PCPR, STIS) Component 4: Perceived Quality 4 attributes (EV, FTR, EM, MV) Source: Author’s Survey Results (see Appendix 11)

108. C. Modification of Attributes of Brand Equity (Factor Analysis) Objective 2 Develop a customer-based brand equity scale for fast food industry Source: Author’s Survey Results

109. D. Models for Consumer-Based Brand Equity Constructs Objective 2 Develop a customer-based brand equity scale for fast food industry Brand Association to its Attributes PVAL and ORG Very significant for both brands ATM Very significant for McDonald’s but moderately significant for Jollibee PER Very significant for Jollibee but moderately significant for McDonald’s DIF and COR Very significant for Jollibee but not significant for McDonald’s

110. D. Models for Consumer-Based Brand Equity Constructs Objective 2 Develop a customer-based brand equity scale for fast food industry Brand Awareness to its Attributes All attributes significantly and positively explains brand awareness JFC: Level of knowledge consumers have about its products and services (KNOW) McDo: Consumer’s ability to retrieve and generate the image of the brand correctly in their memory (RCAL)

111. D. Models for Consumer-Based Brand Equity Constructs Objective 2 Develop a customer-based brand equity scale for fast food industry Brand Loyalty to its Attributes All attributes significantly and positively explains brand loyalty JFC: Driven mainly by STIS, meeting the expectations. McDo: Highly determined by STIS and PCPR. Satisfied with current pricing strategy Inelastic with price increase

112. D. Models for Consumer-Based Brand Equity Constructs Objective 2 Develop a customer-based brand equity scale for fast food industry Perceived Quality to its Attributes All attributes significantly and positively explains perceived quality EM Those who took part in the process of creating, delivering and managing the services have the greatest influence on the assessment of brand’s quality EV where the interaction between firms and customers take place

113. D. Models for Consumer-Based Brand Equity Constructs Objective 2 Develop a customer-based brand equity scale for fast food industry Consumer-Based Brand Equity Model All constructs significantly and positively explains brand equity JFC: Loyalty as main construct that explains brand equity of Jollibee McDo: Brand associations and perceived quality mainly explain brand equity of McDonald’s

114. SUMMARY OF RESULTS For Objective 1: 3 Paradigms show that Jollibee and McDonald’s meets Srivastava’s (2007) requirements in evaluating whether or not a brand has high brand equity. BCG Matrix : Jollibee and McDonald’s fall under cash cow and star category, respectively, areas where brand equity is high. Business Life Cycle : Jollibee and McDonald’s fall under the early stages of maturity, areas where brand equity is high. Sales of both brands continue to grow despite having large market shares already which signifies brand acceptance and high brand equity. Experience Curve : Both brands have diminishing marketing expense to total sales ratio. This implies high brand equity since lesser input costs is required to keep up sales and maintain loyal customers.

115. SUMMARY OF RESULTS For Objective 2: Through factor analysis, it was found that the proposed model from conceptual frameworks of Aaker (1996), Keller and Lehmann (2003), Berry and Lassar et al. (1995) nearly captured the consumer-based brand equity for Philippine Fast Food Chain Brands. Since the factor loadings of the attributes leadership (LDR) and food (FD) are high on brand association (ASSOC) construct instead of perceived quality (PQUAL), the succeeding analysis has factored in both attributes to brand association construct.

116. SUMMARY OF RESULTS For Objective 2: All four constructs significantly and positively influences the strength of brand equity. Perceived quality or overall superiority of a product has been important for the two brands. Consumer’s valuation of Jollibee brand is mainly determined by the loyalty construct. Tracing it to the attributes of loyalty, satisfaction is the primary component which influences consumers’ valuation of the brand. As for McDonald’s, perceived quality and brand association appear to be the most important construct of brand equity. Recall that McDonald’s quality is highly influenced by employees and environment, while association construct is highly influenced by perceived value, attachment and organization.

117. CONCLUSION The attributes food (FD), leadership (LDR), social image (SIM) and trustworthiness (TWS) have not been significant in the assessment of brand equity for either Jollibee or McDonald’s. However, this does not mean that these attributes are not significant in assessing brand equity of other brands. In Jollibee’s brand equity Determinants: brand loyalty (satisfaction) and perceived quality (employees, menu variety and environment) Implications: Maintaining level of satisfaction by providing them consistent quality products and services (serving in promised time, serving food accurately, diverse menu, neat appearance of store and staff) Implications: Standardization efforts are well0known approaches for enhancing quality and managing satisfaction levels.

118. CONCLUSION In McDonald’s brand equity Determinants: Perceived quality (employees, and environment) and Brand Association (perceived value, attachment and organization) Implications: PQUAL: Training service personnel, and emphasis on standardization and speed. Availability of complementary, cleanliness and overall ambiance should always be maintained. ASSOC: what exist in customers’ minds which are formed directly ( from a customer’s own experiences and contact with the brand), or indirectly (through the depiction of the brand in advertising or by other sources of information). Need for a detailed knowledge of the important attributes such as differentiated image, cheerful and enchanting, long history, and familiarity Investment on advertising and promotional activities which carry these images can effectively provide a differentiated and familiar image to the brand. Improve credibility of the organization by supporting activities and charity involvement in social, cultural, sports, or other kinds of public events

119. RECOMMENDATION 1.For Future research which may consider replicating the study, inclusion of larger portion of consumers who ranked these brands as their 1 st choice in the sample. 2.Specify Hierarchy model for these constructs to fill in gaps on the discussion. A hierarchical chain of consumer-brand equity will help explain intensity of causal relationship among dimension of brand equity. 3.Future research can be directed towards the integration of financial-market outcomes perspective. 4.Additional research is necessary to further developed to a more hybrid and composite scale for approximating CBBE in multiple service industries and to suggest other implications for marketing strategies and tactics

120. Thank You!