Testing cross‐cultural invariance of the brand equity creation process

The purpose of this study is to explore the cross‐cultural generalizability of Yoo et al.’s brand equity creation process model. A two‐step approach is introduced and used to test the factorial invariance of the model cross‐culturally. The results reveal which marketing efforts and brand equity dimensions have invariant effects on brand equity across the US and Korean samples. Specifically, brand loyalty and perceived product quality do not have an invariant effect on brand equity, while brand awareness/associations have an equivalent effect. Price and store image show an equivalent, positive effect on perceived quality; distribution intensity has an equivalent, positive effect on both perceived quality and brand loyalty; and price deals have an equivalent, negative effect on both perceived quality and brand awareness/associations. But advertising has a quite different effect on brand equity. The between‐group differences in the brand equity formation process are explained from a cultural perspective.