British Journal of Marketing Studies Vol.3, No.9, pp.47-68, December 2015 ___Published by European Centre for Research Training and Development UK (www.eajournals.org) 47 ISSN 2055-0219(Print), ISSN 2055-0227(online) THE EFFECTS OF ADVERTISING SPENDING AND EVENT SPONSORSHIP ON BRAND EQUITY IN THE ETHIOPIAN BREWERY INDUSTRY Salelaw, Gashaw Tibebe Research Scholar, School of Management Studies, Punjabi University, Patiala Amanpreet Singh Assistant Professor, School of Management Studies, Punjabi University, Patiala ABSTRACT: The field of branding and brand equity is new area of research in Ethiopia. The study adapts an exploratory approach to measure the effects of advertising spending and event sponsorship effect on consumer-based brand equity because there is no study conducted in the Ethiopia beer market. Accordingly, the study assumes advertising spending and event sponsorships affecting brand equity dimensions positively. Hence, a conceptual model has been built and structural equation modeling (SEM) is used to verify the model. A quantitative research was undertaken and a cross-sectional descriptive survey research design in nature was applied in the study. The study confirmed that from advertising spending intensity: television advertising spending has a positive effect on brand awareness; and outdoor advertising has a positive effect on brand awareness, brand association, and perceived quality. On the contrary radio advertising has a negative effect on perceived quality, and print advertising has a negative effect on brand awareness. Furthermore, event sponsorship has a positive effect on brand awareness and brand associations. KEYWORDS: Advertising Spending Frequency, Event Sponsorship, Brand Equity Dimensions, Ethiopia INTRODUCTION The effects of marketing strategies on the creation/building and management of consumer- based brand equity should be critically investigated and measured to know the return on marketing investments/marketing efforts productivity and to maintain the health of brand in the minds of consumer. Aaker (1991) claimed consumer-based brand equity dimensions have affected by a variety of marketing strategies like marketing communication strategies. Keller (2003) has also noted that the added value of the brand is the result of marketing strategies. Accordingly, companies designed different marketing strategies like marketing communication strategies and invest a huge amount of money to create and manage consumer- based brand equity in order to take the advantages from the concept because consumer-based brand equity is an ideal indicator of the performance of long-term marketing investments and an ideal goal to enhance sales and profits simultaneously (Baldinger, 1992). Studies indicated that the individual contribution of marketing efforts like advertising spending intensity and event sponsorship on brand equity is unclear (Chu & Keh, 2006), and scholars have highlighted the need to examine the effects of these variables on the creation and management of brand equity (Netemeyer, et al., 2004). Besides, researchers vary in their opinions and attitudes towards marketing activities effect on brand equity (Dawar & Parker, 1994). Furthermore, marketing practitioners face a great challenge in deciding the optimal