Research Gap

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46 future (Eisen, 2011). Given these findings, it becomes clear that the ongoing generational shift in the luxury customer landscape is likely to implicate significant differences on customer value formation, ultimately influencing the effectiveness of branding activities.

Even though this shift currently represents a large challenge for luxury brands, research has paid little attention to generational differences in the luxury industry so far. This gap appears particularly prevalent when investigating Gen X. The limited stream of research that does investigate Gen X’s purchasing behavior is primarily focused on the general apparel industry and only few researchers draw comparisons between Gen X and Gen Y (e.g. Norum, 2003; Gurau, 2012; Bergh & Behrer, 2016). This may result in the loss of nuances between Gen X and Gen Y, which are essential indicators for managing the generational shift in the luxury sector. Moreover, this clearly indicates the need for further research on the influence of Gen X and Gen Y on branding activities.

Detecting these influences can be done by investigating CBBE. Due to the multifaceted nature of CBBE, no model that is universally applicable across industries could be developed so far (Davčik et al., 2015).

Building on Aaker (1991, 1996) and Keller (1993, 1998), many scholars have approached the development of CBBE measurement scales (e.g. Yoo & Donthu, 2001; Vasquez et al., 2002; Baalbaki

& Guzmán, 2016). However, a comprehensive CBBE model for luxury brands has not been constructed yet, despite several researchers attaining the measurement of CBBE in a luxury context (e.g. Keller, 2009; Kim & Ko, 2012; Gabrielle et al., 2011). Moreover, only a very limited stream of literature was found that included generations when assessing CBBE, although the application of CBBE to develop branding strategies requires profound knowledge of a brand’s customers. Furthermore, identified studies only involved Gen Y and Baby Boomers (e.g. Nowak et al., 2006; Kim et al., 2009; Kim &

Brandon, 2010).

3.1 Research question

The synthesis of the literature shows an important interconnectedness between the three research streams on Luxury Branding, Generational Cohort Marketing, and customer-based Brand Equity and identifies a research gap in their intersection (Figure 4).

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Figure 4: Illustration of intersection of CBBE, generational cohort marketing and luxury branding

Despite a thorough assessment of existing literature, no evidence could be found for the application of a cross-generational assessment of CBBE in the luxury industry. To our knowledge, a research gap exists in this field. Potential generational effects on CBBE of luxury fashion brands are deemed an essential factor in assessing the effectiveness of current and future branding strategies. Identifying such differences is particularly important given the current shift in customer segments from a Gen X domination towards Gen Y as the future luxury customer. Consequently, more knowledge regarding the effect of generational cohort membership on CBBE is required to serve as a guide for the development of effective branding strategies in the luxury industry. These are required to overcome the challenges imposed by the generational shift of luxury customers and are necessary to stay relevant to both Gen X and Gen Y customers by appealing to their unique value perceptions. This study, therefore, aims at closing the identified research gap by investigating the following research question:

How does the generational shift from Generation X to Generation Y influence the customer-based brand equity of luxury fashion brands?

Kapferer (1998) Kapferer & Bastian

(2009; 2012) Vigneron & Johnson (2004)

de Barnier et al. (2011)

Research gap

Luxury Branding Generational cohort

segmentation

Wiedmann et al.

(2012)

Customer-Based Brand Equity

Aaker (1996) Keller (2009) Baalbaki & Guzmàn (2016)

Inglehart (1977) Schewe et al. (2000)

Hellevik (2002)

Keller (2009) Kim and Ko (2012) Godey et al. (2016) Kim et al. (2009)

Kim & Brandon (2010) Nowak et al. (2006)

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3.2 Theoretical and managerial contributions

Answering the proposed research questions is expected to result in both theoretical as well as managerial contributions. First of all, this study will enrich the existing literature by being among the first in the field to investigate the influence of different generations on the development of CBBE in a luxury context. To do so, the CBBE measurement scale based on the existing scales of Aaker (1996), Keller (2009), and Baalbaki and Guzmán (2016) will serve as a guiding construct for data collection (see Measurement Scale, p.41). Due to the absence of a universally applicable measurement scale, it was derived based on the unique features of luxury brands.

Moreover, the selected CBBE dimensions can be related to the value variables identified by Wiedmann et al. (2009) who proposed four dimensions of luxury value perceptions (financial, functional, individual, and social value). Therefore, the established CBBE scale is expected to provide relevant theoretical insights into the value perception of both Gen Y and Gen X luxury customers as well as indications on how these are manifested in the creation of CBBE. The results are expected to serve as a basis for theory development and encourage future research streams. Moreover, this study will increase the scope of existing research streams on CBBE, luxury branding and generational cohort marketing.

Secondly, the results of this study will provide important insights for luxury brand managers. Pressured by the need of accommodating existing customers and capitalizing on the prevalence of a younger customer segment, they are required to adjust their branding strategies in meaningful ways to remain relevant across all customer segments. By investigating CBBE across both Gen Y and Gen Y luxury customers, this study will identify relevant differences as well as similarities in how these two segments determine the value of a brand. The generated insights, in turn, will be translated into guiding principles, supporting luxury brand managers in adjusting branding strategies to effectively address the two customer segments. This will support luxury brands in building a strong brand and obtaining a balance between keeping a profitable base of existing customers and growing the brand further by attracting and maintaining future luxury customers. Consequently, implementing the principles will help brand managers to develop effective branding strategies, possibly leading to a competitive advantage.

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