Nexus between Trust, Credibility, Value and Willingness to Pay (WTP) a Price Premium: Intervening Role of Brand Equity in Herbal Industry

Abstract

Enduring brand trust, credibility, value and equity are essential drivers of customers’ willingness to pay a high price for a brand which can engender a higher profit margin. The role of brand trust, credibility, value and equity in strengthening customers` willingness to pay a price premium has been extensively studied of late. However, studies on the effect of brand trust, credibility and value on willingness to pay more through the intervening role of brand equity, particularly in the herbal industry are relatively scarce. As a result, this paper`s goal was to investigate the brand equity effect on the relationship between trust, credibility, value and willingness to pay a price premium in the herbal industry. Survey questionnaires were employed to gather information from 265 samples of customers through a systematic sampling strategy. The research propositions were tested using structural equation modelling. The study established that brand equity fully mediates the effect of brand credibility and perceived value on willingness to pay a price premium but partially mediates the path between brand trust and willingness to pay more in the herbal industry. The research, therefore, recommends that brand managers need to consider brand credibility, trust, value, and equity in strengthening customers` willingness to pay a price premium for medicinal herbal products in the industry.

Geographical indications as a brand strategy: A literal review

“…A brand helps attract a price premium and willingness to pay by building trust, credibility, and value (Franky and Syah, 2023; Saygili, 2023) [14,46] . When consumers develop positive attitudes and emotional connections towards a brand, such as love and trust, they are more willing to pay higher prices for the products or services offered by the brand (Oppong et al, n.d.) [36] . Additionally, customer experience, satisfaction, and loyalty also play a role in influence brand power and willingness to pay a price premium (Chen and Liu, 2023) [9] .…”

Impact of advertising puffery on purchase intention and brand loyalty of young adults

“…According to Martin‐Consuegra et al (2018), brands can serve as credible signals, encapsulating cumulative outcomes of past marketing communication strategies and functioning as knowledge sources. Previous researchers have examined the impact of brand credibility as a mediator on willingness to pay a price premium (Oppong et al, 2023) and on brand equity (Singh & Banerjee, 2021).…”