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Journal of Hospitality and Tourism Technology Correlation between the homestay experience and brand equity: Using the Yuehetang Rural Residence as a case study Ching-Cheng Shen Der-Jen Liu Article information: To cite this document: Ching-Cheng Shen Der-Jen Liu , (2015),"Correlation between the homestay experience and brand equity", Journal of Hospitality and Tourism Technology, Vol. 6 Iss 1 pp. 59 - 72 Permanent link to this document: http://dx.doi.org/10.1108/JHTT-01-2015-0008 Downloaded on: 29 April 2015, At: 03:42 (PT) References: this document contains references to 42 other documents. To copy this document: [email protected] The fulltext of this document has been downloaded 57 times since 2015* Users who downloaded this article also downloaded: Chaang-Iuan Ho, Pie-Chun Lee, (2015),"Are blogs still effective to maintain customer relationships?: An empirical study on the travel industry", Journal of Hospitality and Tourism Technology, Vol. 6 Iss 1 pp. 5-25 http://dx.doi.org/10.1108/JHTT-01-2015-0005 Fatemeh Shafaei, Badaruddin Mohamed, (2015),"Involvement and brand equity: a conceptual model for Muslim tourists", International Journal of Culture, Tourism and Hospitality Research, Vol. 9 Iss 1 pp. 54-67 http://dx.doi.org/10.1108/IJCTHR-06-2014-0050 Aliana Man Wai Leong, Shih-Shuo Yeh, Li-Hui Chang, (2015),"Nostalgic tourism in Macau: The bidirectional causal relationship between destination image and experiential value", Journal of Hospitality and Tourism Technology, Vol. 6 Iss 1 pp. 89-99 http://dx.doi.org/10.1108/ JHTT-02-2015-0010 Access to this document was granted through an Emerald subscription provided by 606732 [] For Authors If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.com Emerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services. Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation. Downloaded by Sekolah Tinggi Pariwisata Bandung At 03:42 29 April 2015 (PT)

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Page 1: Correlation Between the Homestay Experience and Brand Equity Using the Yuehetang Rural Residence as a Case Study

Journal of Hospitality and Tourism TechnologyCorrelation between the homestay experience and brand equity: Using theYuehetang Rural Residence as a case studyChing-Cheng Shen Der-Jen Liu

Article information:To cite this document:Ching-Cheng Shen Der-Jen Liu , (2015),"Correlation between the homestay experience and brandequity", Journal of Hospitality and Tourism Technology, Vol. 6 Iss 1 pp. 59 - 72Permanent link to this document:http://dx.doi.org/10.1108/JHTT-01-2015-0008

Downloaded on: 29 April 2015, At: 03:42 (PT)References: this document contains references to 42 other documents.To copy this document: [email protected] fulltext of this document has been downloaded 57 times since 2015*

Users who downloaded this article also downloaded:Chaang-Iuan Ho, Pie-Chun Lee, (2015),"Are blogs still effective to maintain customer relationships?:An empirical study on the travel industry", Journal of Hospitality and Tourism Technology, Vol. 6 Iss 1pp. 5-25 http://dx.doi.org/10.1108/JHTT-01-2015-0005Fatemeh Shafaei, Badaruddin Mohamed, (2015),"Involvement and brand equity: a conceptual modelfor Muslim tourists", International Journal of Culture, Tourism and Hospitality Research, Vol. 9 Iss 1pp. 54-67 http://dx.doi.org/10.1108/IJCTHR-06-2014-0050Aliana Man Wai Leong, Shih-Shuo Yeh, Li-Hui Chang, (2015),"Nostalgic tourism in Macau:The bidirectional causal relationship between destination image and experiential value",Journal of Hospitality and Tourism Technology, Vol. 6 Iss 1 pp. 89-99 http://dx.doi.org/10.1108/JHTT-02-2015-0010

Access to this document was granted through an Emerald subscription provided by 606732 []

For AuthorsIf you would like to write for this, or any other Emerald publication, then please use our Emeraldfor Authors service information about how to choose which publication to write for and submissionguidelines are available for all. Please visit www.emeraldinsight.com/authors for more information.

About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The companymanages a portfolio of more than 290 journals and over 2,350 books and book series volumes, aswell as providing an extensive range of online products and additional customer resources andservices.

Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of theCommittee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative fordigital archive preservation.

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Page 2: Correlation Between the Homestay Experience and Brand Equity Using the Yuehetang Rural Residence as a Case Study

*Related content and download information correct at time ofdownload.

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Page 3: Correlation Between the Homestay Experience and Brand Equity Using the Yuehetang Rural Residence as a Case Study

Correlation between thehomestay experience and brand

equityUsing the Yuehetang Rural Residence as a

case studyChing-Cheng Shen and Der-Jen Liu

Graduate Institute of Travel and Tourism Management, National KaohsiungUniversity of Hospitality and Tourism, Kaohsiung City, Taiwan

AbstractPurpose – The purpose of this paper is to investigate the correlation between customer experience andbrand equity for a homestay establishment in Eastern Taiwan.Design/methodology/approach – Visitors staying at Yuehetang Rural Residence (YRR) during themonth of January 2013 were surveyed, and the data were analyzed using descriptive statistics,reliability analysis and typical correlation.Findings – Visitors demonstrated a very high level of overall satisfaction with their homestayexperience (4.43-4.84), especially in terms of YRR’s ability to evoke feelings of being moved ortouched, and of pleasure, excitement and satisfaction. Similarly, YRR’s brand equity was ratedvery high (3.98-4.67). Responders particularly felt that YRR’s image of prioritizing environmentalprotection and the quality of its lodgings were unique sources of added value and, therefore, factorsin creating its healthy brand equity, despite the fact that it was rated low in terms of visibility tohomestay-hunting customers. The correlation coefficient between experience and brand equitywas 0.742, indicating a high degree of positive correlation. The correlation between customerloyalty and brand equity was also quite high, followed by, in decreasing order of strength, thecorrelations between brand equity and the environment-friendly image, the quality of lodging,organic farming and visibility.Practical implications – YRR’s core business value is environmental protection, a factor which, intoday’s increasingly environment-conscious world, has unsurprisingly contributed heavily to its brandequity and customer loyalty. YRR and other homestay operators can utilize the findings of this paper toenhance visitor experience and their own brand equity.Originality/value – This paper is one of the first articles in the homestay experience field that offerscontent that environmental protection is an important factor to brand equity. It also offers numeroustheoretical and practical implications.

Keywords Brand equity, Homestay experience, Organic farming, Yuehetang

Paper type Research paper

1. IntroductionIn recent years, domestic travel within Taiwan has become quite popular. In 2011 alone,213,199,153 tourists visited various tourism sites and recreational attractions inTaiwan. It should be noted that an important component of the tourism industry islodging (accommodations). Taiwan’s domestic hotel industry grew rapidly to cater to

The current issue and full text archive of this journal is available on Emerald Insight at:www.emeraldinsight.com/1757-9880.htm

The homestayexperienceand brand

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Journal of Hospitality andTourism Technology

Vol. 6 No. 1, 2015pp. 59-72

© Emerald Group Publishing Limited1757-9880

DOI 10.1108/JHTT-01-2015-0008

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the needs of the increasing number of visitors. Likewise, development of the homestaybusiness is a response to the increase in tourism. Statistics by Taiwan’s Tourism Bureauindicate that there were 3,961 homestay residences as of November 2012, with 16,451rooms offered. To survive in the extremely competitive homestay business, operatorshave to manage important issues well, such as finding ways to intensify visitors’experiences and create for consumers a sense that the brand itself carries a unique andinherent value or brand equity.

The success of a product or service is made more likely when marketers understandconsumers’ needs and wants, and make deliberate attempts to satisfy them (Keller,2008). A product or service with brand equity occupies a special place in the hearts ofconsumers, who are familiar with and acknowledge the intrinsic value of the product orservice. As a result, consumers will have a greater desire and propensity to makepurchases; additionally, they will enjoy a higher level of satisfaction upon consumption.In turn, increased competitiveness of the company producing the product or service canbe anticipated (Yoo et al., 2000). Brand equity is the key to understand the objectives, themechanisms and the total impact of marketing (Reynolds and Phillips, 2005). Hence, ithas always been an effective differential marketing strategy (Kapferer, 1997; Keller,2003; Kotler, 1988; Pappu et al., 2005; Tasci et al., 2007), as well as an important topic inmarketing management.

The homestay business is a component of the larger hospitality industry. It has thespecial characteristics of intangibility, variability and inseparability, making theshaping of brand equity especially pertinent (Sun and Ghiselli, 2010). Slattery (2003) haspredicted that eventually, branded hotel chains will dominate the hotel industry. Namet al. (2011) have shown that the effects of staff behavior, the physical quality of the hoteland lifestyle congruence heavily influence consumer satisfaction and brand loyalty.Kotler et al. (2003) highlighted the growing importance of brand equity in the hotelindustry. Many well-known hotels, including the Marriott and The Ritz-Carlton hotelchains, view brand equity as the key to their competitiveness. Further, Kim et al. (2008)found that in the mid-price hotel sector, brand equity, guest value and revisit intentionwere significantly correlated, revealing a well-rounded image of the nature of brandequity.

Considering the vibrant growth of Taiwan’s homestay business, individualoperators should look into developing brand equity to compete effectively and toimprove the business performance. However, there is a lack of research on brand equityfor the homestay business. Therefore, this study has utilized related research on brandequity in the hotel industry as a resource for gaining information and a betterunderstanding of the homestay business.

Yuehetang Rural Residence (YRR) is located within the Luoshan Organic Village,situated in Fuli Township, Hualien County. The operator and his family membersstrongly believe in protecting the environment and being kind to planet earth, and insiston organic farming. The operator hopes that visitors will be able to enjoy nature in aclean, cozy and carefree environment. Through experiencing ecology, production andlife within a rural village, the operator also hopes that visitors will be humbled by themagnificence of nature and the abundance of life.

Given its uniqueness and environmental significance, does YRR provide visitorswith a one-of-a-kind experience? Is the special emphasis it has placed on organic farmingand environmental protection reflected in its brand equity? These issues are the central

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topics of this study, and they are also critical to the long-term sustainable developmentof YRR and similarly oriented homestay establishments. The focus of this study is therelationship between the homestay experience and brand equity. A typical correlationmodel was developed based on these two factors and was verified by feedback from thevisitors to YRR. The findings of this study will provide a deeper understanding ofimportant factors that could affect YRR’s brand equity, and more specifically, thehomestay experiences that influence brand equity. At the same time, we can gain betterinsights into the impact that environmental significance and organic farming have onthe creation of experience and the enhancement of brand equity. It is hoped that thesefindings will serve as a reference for YRR to enhance visitors’ experiences and its brandequity, and, by extension, provide useful information for all eco-tourism homestayoperators.

2. Literature review2.1 Brand equityBranding is an effective tool that a company uses to distinguish its products fromthose of other companies. It is also an important topic studied by those interested inmarketing. Brand equity is derived from the name of a brand that endows a physicalproduct with added value (Farguhar, 1990; Aaker, 1991; Biel, 1992; Kamakura andRussell, 1993). The marketing stimulus of a particular brand creates in consumersthe knowledge that this brand is different from the others; the favorable reputationis beneficial to the company and to the related stakeholders (Keller, 1993). Brandequity is manifested through the associations that consumers make with the brand,while brand association is the result of brand recognition (Aaker, 1991). Throughbrand equity, a brand, a name or even a symbol can enhance or diminish theperceived value that consumers place on a particular product or service (Aaker,1992).

Keller (1993, p. 2) proposed the concept of customer-based brand equity (CBBE),defined as “the differential effect of brand knowledge on consumer response to themarketing of the brand”. It is measured in terms of four dimensions such as:awareness, image, quality and loyalty (Aaker, 1991; Keller, 1993; Faircloth et al.,2001; Yoo and Donthu, 2001; Konecnik, 2006; Sun and Ghiselli, 2010). CBBE studieshave been extended to cover tourism and its related industries, including hotels,restaurants, casinos (Prasad and Dev, 2000; Kim and Kim, 2005; Tsai et al., 2009) andtravel destinations (Konecnik, 2006; Boo et al., 2009). Tuli and Bharadwaj (2008)showed that strong CBBE was correlated to increased levels of customersatisfaction and loyalty.

When customers select a hotel, they often base their decisions on their awarenessand knowledge of the brand. CBBE helps hoteliers come up with marketingstrategies that prompt customers to acknowledge the value provided by a hotel andto remember its unique brand. Studies on the brand equity of hotels (Kim and Kim,2005; Sun and Ghiselli, 2010) have referred to CBBE, proposed by Keller (1993), asthe measuring index of brand equity. Xu and Chan’s (2010) CBBE-grounded studyhas gone on to suggest that understanding the consumer’s experience is a key todeveloping brand equity.

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Similarly, this study has taken CBBE as the theoretical base for measuring brandequity of homestays. The dimensions used in the study include the following: visibility,quality, image and customer loyalty. Visibility refers to the recognition,acknowledgement and recollection that consumers have of a particular brand; thehigher the visibility, the greater the probability of the product being purchased (Aaker,1991). Quality is the perception that customers have of the product or service of a brand;as quality can affect the consumers’ propensity to purchase (Low and Lamb, 2000), itdirectly affects the sales performance of that brand (Buzzell and Gale, 1987; Aaker,1991). Image refers to the memories of a brand that consumers have, which lead torecollections through association; it is a reflection of consumers’ acknowledgement ofthe brand (Aaker, 1991; Keller, 1993). Lastly, customer loyalty leads to the willingness tocontinue purchasing the products of the original brand, even when faced with the optionof similar products belonging to another brand (Aaker, 1991). As YRR’s core businessvalues are environmental protection and sustainability of resources and as it is locatedwithin an organic village, its image encompasses organic farming and environmentalprotection.

2.2 ExperienceExperience refers to visitors’ pleasant memories associated with a place; it is the corevalue of leisure tourism. Oh et al. (2007) developed a measurement scale based on thework of Pine and Gilmore’s (1999) to assess the rational and emotional responses ofvisitors to US bed and breakfast establishments. They further suggest that their modelcan be adapted to be used in destination hotel sectors — four realms of experience insummary rational and emotional assessment of the destination experience to explorehotel guest’s experiences in the US bed and breakfast industry — and suggest can befurther refined for adoption by destination marketers.

Verhoef et al. (2007) stated that consumers who were very satisfied with a product orservice would have a heightened sense of loyalty to that brand, which is to say, the brandwas to develop equity with them. Holbrook and Hirschman (1982) proposed thatconsumption goes beyond the rational consideration of functionality to include thesensation of hedonic consumption. The consumption experience is derived from thepursuit of fantasies, feelings and fun. Schmitt (1999) defined experience as anindividual’s reaction to certain stimuli. It originates from the interaction between theoccurrence of an event and the individual’s psychological state at that moment.Experience goes beyond the appeal to rationality or emotion. It emphasizes the overallfeelings that are stimulated in consumers. Through stimulation of the senses and themind, experience links up a company, its brand and the lifestyles of consumers. In thebroader social context, experience combines the actions of individual customers withthe situations under which consumption will occur.

As for the measurement of experiences, Schmitt (1999) proposed five strategic andexperiential modules: sensory experiences (Sense experience); affective experiences(Feel experience); creative cognitive experiences (Think experience); physicalexperiences, behaviors, and lifestyles (Act experience);and social identity experiences(Relate experience). Sense experience creates the perception of added value of a product

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through the emotions of pleasure, excitement and satisfaction felt by the consumers.Feel experience refers to the feelings and emotions that inherently make consumers feeltouched. Understanding which type of stimulus causes which mood in consumers canlead to their voluntary participation in the consumption process.

Think experience uses creativity to solve consumer problems, thereby causing aparadigm shift. Act experience enriches the lives of consumers by providingalternative activities and lifestyles through bodily interactions and experiences.Relate experience facilitates the establishment of relationships between individualsand a broader social system. The main purpose is to build a strong brandrelationship and brand community through the individual’s desire forself-enhancement. This study has used the five dimensions proposed by Schmitt(1999) as the basis for analyzing experiences.

3. Research methodology3.1 Research frameworkThe focus of this study was the correlation between the homestay experience and brandequity. The observed variables for the homestay experience included the fivedimensions of experience: Sense, Feel, Think, Act and Relate. The observed variables forbrand equity included visibility, customer loyalty, quality of lodging, image of theorganic farming industry and image of environmental protection. The researchframework is illustrated in Figure 1.

3.2 AssumptionsBrand experience is the main trigger for brand equity (Berry, 2000). Customer-orientedmarketing especially focuses on the intensification of brand equity through experiences(Ambler et al., 2002). Experiences increase emotional benefits, which in turn strengthenthe brand (Ambler, 1997; Bhat and Reddy, 1998; Long and Schiffman, 2000). Hence, theresearch assumption H1 has been proposed as: There is a positive correlation betweenexperience and brand equity (Figure 1).

Figure 1.Research framework

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3.3 Survey design and processThe survey evaluated the following: (i) experience, (ii) brand equity and (iii)demographic variables. Parts (i) and (ii) were measured using the Likert 5-point scale,while (iii) was measured via a category scale. The survey was targeted at visitors whostayed at YRR, and respondents were selected through convenience sampling.Forty-five questionnaires were issued during the survey period of 8-31 January 2013.Upon retrieval, 43 completed questionnaires were deemed as valid, representing aneffective recovery rate of 95.56 per cent.

4. Empirical analysis4.1 DemographicsAnalysis of the basic data of the survey respondents reflected the predominance offemales (62.8 per cent). More than half of the respondents were married (58.1 per cent). Interms of age, most were 31-40 years old (44.2 per cent), followed by those who were 21-30years old (20.9 per cent). Military and government personnel included 20.9 per cent of therespondents, while students comprised 18.6 per cent. In terms of education level, 41.9 percent were college graduates, followed by post-graduates and above (23.3 per cent).Approximately, 28.2 per cent earned an average monthly pay of US$6,666.67 (inclusive)or less, while 17.9 per cent earned US$10,000-1,333.33. A large proportion (34.9 per cent)of the respondents lived in the North (Keelung, Taipei, Taoyuan and Hsinchu), whilethose living in the East (Taitung, Hualien and Yilan) ranked second at 27.9 per cent.These results are summarized in Table I.

4.2 Basic travel informationThe basic travel information of the respondents is shown in Table II. More than half(53.5 per cent) reported that it was their first time stay at YRR, and almost a third(30.2 per cent) said they had visited three or more times before. Most (62.8 per cent)arrived at YRR by car, and 23.3 per cent by train. Slightly less than half (48.8 percent) were traveling with friends, with immediate family as the second most populartraveling companions (39.5 per cent). A large majority (72.1 per cent) was staying forone night, and 14 per cent were staying for two. Over half the guests (60.4 per cent)reported that their room was less than NT $1,000 per night, and roughly equally asmany (66.7 per cent) thought that the rooms were reasonably priced. 40.5 per centsaid they had been introduced to YRR by family, and 26.2 per cent said they hadfound it on the Internet. Finally, 45.2 per cent stated that they occasionallyencountered environmental issues in their daily life, and 35.7 per cent said that theyoften encountered them.

4.3 Brand equityThe results of the analysis of YRR’s brand equity are shown in Table III. Overall,YRR’s visitors scored its brand equity very highly (3.98-4.67). The brand equityfactor A10 (warm hospitality) had the highest score, followed by A9 (intentions toprotect the environment and ensure environmental sustainability). A1 (visibility)had the lowest score. The results indicate that it is very important for homestays torecreate the warm and cordial atmosphere of home. YRR’s business philosophy of

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Table I.Profile

Items Frequency (%)

GenderMale 16 37.2Female 27 62.8

Married statusMarried 25 58.1Single 18 41.9

Age�20 5 11.621-30 9 20.931-40 19 44.241-50 5 11.651-60 3 7.0�60 2 4.7

OccupationStudent 8 18.6Military/Government 9 20.9Agriculture 2 4.7Industry and commerce 7 16.3Service industry 7 16.3Homemaker 4 9.3Freelance 2 4.7Other 4 9.3

Level of educationNot completed high school 9 20.95-year community college 5 11.6University 18 41.9Post-graduate 10 23.3

Averages monthly income� 20,000 NTD 11 28.220,001-30,000 NTD 6 15.430,001-40,000 NTD 7 17.940,001-50,000 NTD 6 15.450,001-60,000 NTD 5 12.8�60,000 NTD 4 10.3

ResidenceNorthern Taiwan (Keelung, Taipei, Taoyuan and Hsinchu) 15 34.9Central Taiwan (Miaoli, Taichung, Changhua and Nantou) 9 20.9South of Taiwan (Chiayi, Tainan, Kaohsiung, Pingtung) 7 16.3Eastern Taiwan (Taitung, Hualien and Ilan) 12 27.9Other 0 0

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Table II.Analysis of travelingcharacteristics

Item Frequency (%)

Previous visits0 (1st visit) 23 53.51 (2nd visit)\ 3 7.02 (3rd visit) 4 9.33� (4th or more visit) 13 30.2

TransportationTrain 10 23.3Car 27 62.8Motorcycle 4 9.3Tour bus 0 0Other 2 4.7

Traveling companionsImmediate family 17 39.5Extended relatives 0 0Friends 21 48.8Classmates 1 2.3Colleagues 2 4.7Other 2 4.7

Length of stay1 night 31 72.12 nights 6 14.03 nights 1 2.34� nights 1 2.3

Averages room price�800 NTD 13 30.2801 to 1,000 NTD 13 30.21,001 to 1,200 NTD 5 11.61,201 to 1,400 NTD 1 2.3Over 1,400 NTD 5 11.6

Perception of room pricesToo high 0 0A little bit high 1 2.6Reasonable 26 66.7A little bit low 6 15.4Very low 6 15.4

Introducing sourceLive in the area 4 9.5Family and friends 17 40.5Newspaper or magazine 6 14.3Internet 11 26.2News program 2 4.8Travel guide 2 4.8Other 4 9.3

Daily life exposure to environmental issuesInfrequent 0 0Occasional 0 0Often 8 19.0Very frequent 19 45.2Constant 15 35.7

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environmental sustainability was also an important factor that shaped its brandequity. Although it enjoyed a certain degree of visibility, there was room for furtherimprovement.

The results of the analysis of the various dimensions of YRR’s brand equity areshown in Table IV. The reliability estimates for the various dimensions were high(0.70-0.76). Its image regarding environmental protection had the highest score. Nextwas the quality of lodging. Visibility ranked lower.

4.4 Homestay experienceThe results of the analysis of visitors’ experiences at YRR are shown in Table V. Overall,visitors gave it a very high rating of 4.43-4.84. Experience B7 (cordial and personableservice) received the highest score. Next, in descending order of scores, were B8 (simpleand pure lodging atmosphere), B9 (carefree and easy feeling), and B4 (fresh and naturalair). Again, the importance of warm and cordial service was emphasized. The simplicityand carefree pace of rural life within the natural environment provided visitors withprofound experiences.

Table VI shows the results of the analysis of the various dimensions related tovisitors’ experiences at YRR. The reliability estimates for the various dimensionswere 0.66-0.78. Other than the slightly lower value for Act experience, the reliabilityvalue for the other dimensions was high. Feel experience ranked the highest,followed by Sense experience.

4.5 Correlation between the homestay experience and brand equityThis study used typical correlation analysis to evaluate the relationship betweenexperience and brand equity. The results are shown in Figure 2 below:

Table III.Brand equity factors

of YRR

Brand equity factors Mean SD

A1 It has high visibility compared to other homestays in Hualien 3.98 0.71A2 I am willing to stay here again 4.53 0.50A3 The quality of service is very high 4.53 0.55A4 The quality of the facilities is very high 4.30 0.56A5 I wish to stay here because it is located in an organic village 4.49 0.51A6 The quality of the rural experiential activities provided is very high 4.38 0.58A7 I yearn for the atmosphere of rural living and simple life that has been created 4.42 0.76A8 Whenever I see it, I associate it with organic farming 4.29 0.74A9 I can feel the intentions to protect the environment and to ensure environmental

sustainability4.57 0.55

A10 Its warm hospitality makes me feel as if I am at home 4.64 0.53

Table IV.Dimensions of YRR’s

brand equity

Dimension Mean SD Cronbach’s value (�)

Visibility 3.98 0.71 –Customer loyalty 4.48 0.57 0.70Quality of lodging 4.50 0.45 0.76Image regarding organic farming 4.38 0.50 0.73Image regarding environmental protection 4.57 0.55 –

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Table V.Visitors’ experienceswhile staying at YRR

Variables of the homestay experience Mean SD

B1 The surrounding natural scenery (e.g. farms, mountains) is very beautiful 4.63 0.49B2 The organic meals provided are delicious 4.63 0.54B3 The ecology and ambience of the surrounding are fantastic 4.60 0.54B4 The surrounding air is fresh and natural 4.72 0.45B5 The DIY activities (e.g. experience of hands-on baking) are enjoyable 4.56 0.55B6 The facilities (e.g. bedroom, bathroom and lighting design) are very cozy 4.44 0.59B7 The service provided is cordial and personable 4.84 0.37B8 I like the simple and pure lodging atmosphere 4.74 0.44B9 I enjoy the carefree lifestyle when lodging here 4.72 0.45B10 The surrounding organic environment is something I appreciate 4.67 0.47B11 I concur with the actions taken to protect the environment and love the earth 4.63 0.54B12 I enjoy sampling organic products (e.g. organic rice) 4.62 0.54B13 The homestay experience has increased my preference to purchase organic

farm products4.51 0.59

B14 I wish to experience rural living here 4.44 0.63B15 I have deeper feelings about environmental protection since staying here 4.43 0.67B16 I prefer homestays that focus on the environment since staying here 4.38 0.73B17 I am willing to share my experiences here with others 4.67 0.52B18 I am willing to share with others YRR’s views and actions regarding

environmental protection4.63 0.49

Table VI.Dimensions of YRR’svisitors’ experience

Dimension Question no. Mean SD Cronbach’s value (�)

Sense experience B1, B2, B3, B4 4.65 0.41 0.82Feel experience B6, B7, B8, B9, B10 4.68 0.39 0.88Think experience B11, B12, B15 4.56 0.50 0.82Act experience B5, B13, B14 4.52 0.45 0.66Relate experience B16, B17, B18 4.56 0.51 0.82

Figure 2.Typical correlationbetween experienceand brand equity

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The correlation coefficient between experience and brand equity was 0.742,indicating a high degree of positive correlation. Intense experiences appear toenhance brand equity. From factor loading, it can be seen that Relate experience hadthe highest correlation with overall experience, followed by Act experience, Thinkexperience, Feel experience and Sense experience (in decreasing order of factorloading). The correlation between customer loyalty and brand equity was thehighest; the correlation between loyalty and the image regarding environmentalprotection was next, followed by the correlations with quality of lodging, imageregarding organic farming and visibility.

There has been an increasing worldwide emphasis on environmental protection.Given that YRR’s core business value is precisely environmental protection, it is notsurprising that its visitors have reported that their experiences at YRR profoundlyinfluenced their lives, thoughts and actions. Customer loyalty to YRR is animportant component of brand equity, while the image regarding environmentalprotection contributes fundamentally to the shaping of brand equity. As for therelatively low impact of visibility on brand equity, there was no need for YRR togenerate a large visitor volume, given the limited number of rooms available.

5. Discussion and conclusionBrand equity is a form of differentiation based on a clear image; it goes beyond thesimplistic preference for a product (Shocker and Weitz, 1988). Throughdifferentiation between oneself and one’s competitors, brand equity endows aproduct with an added value (Farguhar, 1990). Therefore, it is a corporate asset,giving a company sustained competitive advantage and improving its businessperformance (Day, 1994; Aaker, 1996).The core value of tourism lies in the vacation experience, which leads to the creationof unforgettable memories for the visitors. The findings of this study point to a highcorrelation between experience and brand equity. The intensification of visitors’experiences will strengthen a brand’s competitive edge and build brand equity.

Since the core business value of YRR is environmental protection, it aims tocreate a setting in which guests can feel that they are living in harmony with theenvironment, happily, comfortably and healthfully. This study’s findings havehighlighted the importance of providing warm and cordial service in the context ofa homestay that primarily focuses on being environmentally friendly. The naturalrural environment and lifestyle also contributed to the profoundness of visitors’experiences. In addition to customer loyalty and the quality of lodging, YRR’s imageregarding environmental protection and organic farming further helped to shape itsbrand equity.

At present, both brand equity and visitors’ experiences at YRR were highly rated.It is recommended that YRR continues to find ways to further intensify the Senseexperience and Feel experience that it generates. In addition, YRR may wish totransform its business principle of environmental sustainability to manifest itself inthe forms of Think experience, Act experience and Relate experience for visitors. Atthe same time, it should continue to upgrade the quality of its lodging services, andfurther strengthen its image in environmental protection and organic farming.Doing so would enhance YRR’s brand equity, thereby increasing its competitivenessand improving its visibility in the homestay business.

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Corresponding authorChing-Cheng Shen can be contacted at: [email protected]

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