The effect of perceived brand leadership on luxury service WOM

Yonghwan Chang, Yong Jae Ko, Walter L. Leite

Research output: Contribution to journalArticlepeer-review

32 Scopus citations


Purpose: Despite the remarkable growth of the luxury industry, a phenomenon referred to as luxury fever, as well as the growing interest in word-of-mouth (WOM) marketing in the industry at hand, little is known about how consumers’ perceived leadership of luxury brands dynamically influences their WOM behavior. This paper aims to examine the moderating role of a type of luxuries (accessible vs inaccessible) in the relationship between the four dimensions of perceived brand leadership – quality, value, innovativeness and popularity – and consumers’ WOM recommendation intention. Design/methodology/approach: The current research is based on survey data gathered from 333 actual customers who attend five golf clubs located in North Florida. An innovative data analysis procedure that combines structural equation modeling with propensity score analysis to estimate the moderating effects, controlling for selection bias, is presented. Findings: Quality was the significant predictor of WOM among consumers of inaccessible luxuries (private club). In contrast, financial value and popularity were key factors in predicting WOM of individuals who chose accessible luxuries (public club). Originality/value: This paper attempts to shed new light on the field of strategic luxury marketing by addressing differential consumption decision-making processes corresponding to hierarchically constructed luxury services. In addition, an innovative way is suggested to achieve covariates’ balance in the examinations of latent variables and multisampling models for observational research.

Original languageEnglish (US)
Pages (from-to)659-671
Number of pages13
JournalJournal of Services Marketing
Issue number6
StatePublished - 2016

Bibliographical note

Publisher Copyright:
© 2016, © Emerald Group Publishing Limited.


  • Brand leadership
  • Luxury products
  • Propensity score analysis
  • Selection bias
  • Word-of-mouth recommendation


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