PurposeThis study aimed to develop a generalisable small and medium-sized enterprise (SME) brand equity scale and examine its relationship with consumer response factors.Design/methodology/approachThe study which was done in Thailand included three steps. First, brand communications of 40 successful SMEs and opinions of 56 consumers were collected by document analysis, interview and focus group for generating items and measurement of stimuli. Second, 838 consumers were surveyed to define the dimensions of the brand equity and the top SMEs. Third, surveys with 552 customers of the three most popular SMEs, one from each of the manufacturing, service and trade businesses, were conducted to examine the scale's invariance and its relationships with consumer responses.FindingsThe SME brand equity (SMEBE) scale included 23 items that were grouped into five components named brand awareness, functionality, authenticity, attentiveness and resonance. The scale is applicable across consumers that vary in their product involvement and brand engagement. The SMEBE significantly affected the brand's preference, loyalty and word-of-mouth.Research limitations/implicationsSince the SMEBE scale was tested with three brands, one from each of three business sectors, future studies should measure more than one SME for each business type. To allow for potential cultural characteristics that might affect the study, replications in diverse international settings are required.Practical implicationsSME managers should increase the awareness, functionality, authenticity, attentiveness and resonance of their brands as these components are essential for SMEBE, which, in turn, significantly affects consumer behaviour.Originality/valueThis study develops a ready-to-use SMEBE scale and introduces a practical research design for quantitative research on SME branding.

This study had two research objectives: (1) to develop and validate a generalizable model for measuring consumer-based brand equity within the SME setting, and (2) to examine the relationship between SME brand equity and consumer response factors. Three steps were conducted in sequence to achieve the research purposes. Firstly, qualitative data from documents of forty awarded SME brands and actual consumers varying in their demographic characteristics were collected by three techniques including document analysis, semi-structured interview, and focus group to get a pool of 41 initial items of SME brand equity. Secondly, the items derived from the first step were analyzed by the exploratory and confirmatory factor analyses. The measurement model of SME brand equity fitted well with the empirical data (Chi-Square [37, N=419] = 40.220, p = .330; CFI = .999, RMSEA = .014). Then, three competing models of SME brand equity was examined. Only the second-order factor model (Model 1) fitted with the data (Chi-Square [37, N=419] = 40.220, p = .330; CFI = .999, RMSEA = .014). The causal model (Model 2) (Chi-Square [85, N=419] = 574.045, p = .000; CFI = .868 RMSEA = .117) and the causal model with relationships between dimensions (Model 3) (Chi-Square [36, N=419] = 58.221, p = .011; CFI = .992, RMSEA = .038) differed significantly from the empirical evidence. According to the pattern of the best-fitting model, SME brand equity was set to be a second-order latent variable with five first-order latent variables consisting of brand functionality, brand authenticity, brand attentiveness, brand awareness and brand resonance. Lastly, SME brand equity measurement model was examined for its relationship with consumer response factors and its measurement invariance across business sectors as well as among consumers differing in their characteristics. The results of measurement invariance across business sectors showed the configural invariance or the situation that the three business types shared the same pattern of SME brand equity measurement model fitting well with the empirical data or the opinion of customers assessing three specific brands representing three business sectors (Tofusan [Manufacturing]: Chi-Square [204, N=184] = 210.241, p = .367; CFI = .997, RMSEA = .013) (Santa Fe' [Service]: Chi-square [194, N=184] = 219.594, p = .100; CFI = .992, RMSEA = .027) (Eveandboy [Trade]: Chi-Square [202, N=184] = 203.404, p = .459; CFI = .999, RMSEA = .037). The further analyses showed the partly metric invariance which meant some items are the fundamental criteria customers adopted to assess the SME brand equity within every business context, but some items should be interpreted differently in each sector of SMEs. The tests of measurement invariance among individuals with different characteristics indicated that SME brand equity model fitted well with the empirical data or the opinion of the six customer groups varying in the degree of SME brand equity (High: Chi-Square [197, N=303] = 213.287, p = .203; CFI = .992 RMSEA = .017, Low: Chi-Square [193, N=249] = 221.865, p = .076; CFI = .986 RMSEA = .025), product involvement (High: Chi-Square [194, N=298] = 216.174, p = .132; CFI = .993, RMSEA = .020, Low: Chi-Square [188, N=222] = 211.952, p = .111; CFI = .989, RMSEA = .024), and brand engagement (High: Chi-Square [200, N=295] = 225.211, p = .107; CFI = .990 RMSEA = .021, Low: Chi-square [193, N=215] = 216.419, p = .119; CFI = .989, RMSEA = .024). Further analyses showed the metric invariance of SME brand equity model among consumers with high and low SME brand equity, product involvement, and brand engagement. The findings about the relationship of SME brand equity and consumers’ brand responses indicated that the structural equation models depicting the relationship of SME brand equity and three consumer response factors including brand preference, brand loyalty, and word of mouth fitted well with the empirical evidence or the opinion of the three selected brands’ customers (Tofusan [Manufacturing]: Chi-Square [270, N=184] = 301.240, p = .093; CFI = .988, RMSEA = .025) (Santa Fe' [Service]: [247, N=184] = 276.888, p = .093; CFI = .993, RMSEA = .026) (Eveandboy [Trade]: Chi-Square [264, N=184] = 295.190, p = .091; CFI = .988, RMSEA = .025). In the case of the manufacturing brand or Tofusan, the consumer response variable most explained by SME brand equity is 65.9 percent of word of mouth (R2 = .659). In the setting of the service and trade SMEs, brand preference’s variance was explained in the largest amount by SME brand equity or 84.1 percent and 57.6 percent in the case of Santa Fe' (R2 = .841) and Eveandboy (R2 = .576), respectively.