Model of Causal Factor Affecting the Business Performance of the Garment Industry in Gongqing City, Jiangxi Province

Abstract

Background and Aims: The garment industry in Gongqing City, Jiangxi Province, known as China's premier hub for down clothing, faces a critical strategic transition from original equipment manufacturing (OEM) to a brand-driven competitive model. Despite a rich body of marketing scholarship on advertising effectiveness and brand equity, limited empirical attention has been given to the psychological mechanisms through which advertising translates into measurable business outcomes in culturally distinctive regional industrial clusters. Drawing on brand equity theory, the hierarchy-of-effects model, and the resource-based view, this study aimed to: (1) identify key causal factors affecting business performance (BP); (2) analyze the causal relationships among advertising exposure (AE), brand recognition (BR), emotional connection (EC), and BP; and (3) develop and validate a structural model illustrating how these factors influence BP through dual mediation.

Methodology: A concurrent mixed-methods design was employed to ensure both theoretical rigor and contextual depth. Quantitatively, a questionnaire survey was administered to 420 employees drawn from 20 representative garment enterprises in Gongqing City using stratified random sampling. Constructs were measured using validated scales adapted from established marketing research on a 5-point Likert scale. Data were analyzed using Structural Equation Modeling (SEM) via AMOS, preceded by reliability (Cronbach α), convergent validity (Average Variance Extracted), and discriminant validity assessments. Qualitatively, semi-structured interviews with 15 industry experts provided contextual explanations of the quantitative patterns.

Results: All seven hypotheses were supported. AE exerted a significant direct effect on BP (β=0.25), as well as strong positive effects on BR (β=0.90) and EC (β=0.57). BR and EC, in turn, significantly influenced BP (β=0.43 and β=0.39, respectively). Critically, indirect effects through BR (β=0.387) and EC (β=0.222) together accounted for 70.9% of AE's total effect (β=0.859) on BP, revealing that the predominant pathway from advertising to performance is psychological rather than direct. The structural model demonstrated excellent fit (χ²/df=0.864, RMSEA=0.000, GFI=0.967, NFI=0.959). Qualitative findings identified Douyin live-streaming, local ‘red culture’ storytelling, and eco-friendly branding as concrete mechanisms amplifying these mediation pathways.

Conclusion: This study advances marketing theory by validating a dual-mediation model in which AE influences BP primarily through sequential cognitive and affective pathways. The disproportionate magnitude of indirect effects representing 70.9% of total advertising impact challenges the conventional emphasis on direct advertising returns and signals a paradigm shift toward psychologically driven brand management for SMEs in manufacturing-based clusters. Practically, the findings provide a strategic framework for Gongqing garment enterprises to realign marketing investments from output-based advertising toward brand equity cultivation and emotionally resonant communication.