In a competitive and brand conscious market, like Kenya, building brand equity of any product is a challenging task. Companies need to assess the prior experiences and future aspirations of consumers to possess these brands. In this context, we examine the effect of advertisement and word of mouth on brand equity. Data was collected from 384 shoppers from three supermarkets Eldoret town, Kenya, through self-administered questionnaires using systematic sampling technique. Out of these, 346 were used for the purpose of this study, which provided a response rate of 90 percent. Multiple regressions confirmed that advertisement exerts a significant, positive effect on brand equity; the results also reveal a positive and significant moderating effect of word of mouth on the relationship between advertisement and Brand equity. These results add some new understanding to the literature on advertisement, word of mouth, brand equity and their interrelationships which influence the development of the retail industry in a developing country context. Firms need to put more emphasis on advertisement by differentiating their ads from those of competitor’s brands, being creative in their adverts, improve reputation of their brands, focus effort on massage impression and opinion leaders whose word of mouth influences brand equity.
