Corporate brand is a product of millions of experiences a company creates with employees, vendors, investors, reporters, communities, and customers and the emotional feelings these groups develop as a result. A strong corporate brand creates, manages, and fulfils high expectations among its many audiences.
It does this by aligning the fundamentals of the business-products, service, processes culture and giving them a common rule book, a set of guidelines for making decision can be described as the process of creating, nurturing and sustaining a mutually rewarding relationship between a company and its internal and external stakeholders including managers and other employees of the company, customers, investors, suppliers, corporate partners, members of the local community, special interests like activists.
In corporate branding, all the products across the businesses carry the corporate name. For instance, Sony might be considered the ultimate corporate endorser with its name firmly attached to everything from its DVD to the Play Station. Another strong corporate brand is Marriott, with its Marriott Conference Centres, Marriott Vacation Club, Courtyard by Marriott and numerous other properties linked to the Marriott name.
Sony, GE, Philips, LG are all effectively using their corporate identities across the global markets. Videocon, BPL, Voltas and Amul are all some of the Indian firms successfully following the corporate branding strategy.
“Branding”, is like setting names for products. Nobody would set up in business or launch a new product without giving it a name. Branding is a very important part of promotion. It can help a business to establish an identity to the product. Furthermore, ‘Branding’ contributes to the value and financial viability of businesses, just like their products, fixed assets and input.
Businesses therefore, spend large amounts of money on TV and newspaper advertising campaigns, in order to end up with name that foremost is in everyone’s mind. Just think of ‘Coca-cola’ and ‘Pepsi’ competition, they both spend an obscene amount of money in promoting their brand each year to become the dominant brand.
We can also notice that many of their ads don’t even contribute to its product, but rather, selling their brand and try to create “brand awareness” as well as “brand loyalty.” Why? The answer is simply because they want to create a “well-established” brand, which would eventually formulate an inseparable link between its product and the provider.
This becomes apparent as we just see how powerful ‘branding’ can be as a selling tool in our multi-media marketing environment, when looking at areas such as: Computers, we would automatically think of IBM; or Software we would automatically think of Microsoft. These companies have established themselves as “the” dominant player in their fields. Such good job at impressing its brand into consumer’s mind may also gain advantages in competing with other brands/products.
Even for businesses that have superior products at superior prices, but without a ‘well-established brand’, they might still have disadvantages when comparing to one’s corporate brand that is well-established. From this, it can be seen that the power of branding might even be more important tan the quality or price of your product. In addition, when competition is global, it may also gain advantages, as branding is a way to distinguish your product from other competitors’ products as well as differentiate yourself and your business from the competition.
Branding is also like the reputation of a company, which also effects business’ publicity. Often the choice of setting up an industry or a business is often directly linked to this notion of reputation. As a company has a good reputation, it may attract new customers, which would create ones’ demand and ‘brand loyalty’.
Customers tend to purchase products from companies that have a good reputation. This is because as the firm have a good publicity, consumers tends to ‘trust’ their products, hence, consumers will be more willingly in trying their products, which would increase the amount of new customers for the business.
As the business have more new customers, its demand and loyalty would eventually increase. As consumers try the products, satisfy with its quality, most of them will get used in using the product and are unwilling to change to another brand. The company would also gain more consumers’ recognitions. Thus, such consumers will repeat-purchase the product on a regular basis. This way, brand loyalty would not only eliminate competition, but also increase business’s sales and revenue, and presumably its profit would increase as well.
As a company have great amount of brand loyalty, the product’s price elasticity would eventually be low. This is because consumers are unlikely to be price sensitive. As the price elastic is low, it enables company to increase the price level without much effort upon demand and the company can create value and a premium price.
Such companies would have the benefit in setting their price higher than the price of similar products, such as products from “Burberry.” However, such products’ qualities may not necessarily be superior. However, a ‘well-known brand’ is not easy to build, especially for young companies. Also, it takes years to build and can be damaged very rapidly.
Furthermore, “branding” is a very expensive promotion tool. Therefore, it requires large amount of financial resources, which businesses may not have the ability to pay. For instance, businesses would have to pay for registration cost for trademark, which avoids other competitors to ‘steal’ your idea, as called as ‘legal’ cost. Even for a well-established brand name, it can be easily forgotten in consumers’ mind, therefore, it would be costly for businesses to pay for ‘continuous’ promotion of the brand.
Nevertheless, ‘branding’ is a very powerful tool in promotion and also very important tool for developing businesses. Although it is an expensive tool, which some businesses may not be able to afford the amount of money for ‘branding.’ Such businesses might results with some disadvantages when compare with a well-branded business, however for some cases/markets, branding may not be as important to consumers, such as plants.
Ultimately business is only as good as the identity that underpins it, as ‘branding’ allows businesses attract new customers and make “established” customers return time and again. Thus, it increases ones’ profit.
Product Branding and Corporate Branding
To understand the concept of corporate branding framework clearly, it has to begin with examining how corporate branding differs from product branding and by identifying the main organizational implications of these differences. Corporate branding differs from product branding in several respects (see Table 1). Table 1 illustrates the factor based upon which product brands differ from the corporate brands.
First, and most obviously, the focus of the branding effort shifts from the product to the corporation. Of course, product and corporation are related in that corporate brands add economic value to the variety of products and services offered by the company.8, 9, 13, 14, and 16.
Corporate branding employs the same methodology and toolbox used in product branding, additionally it also elevates the approach a step further into the board room, where additional issues around stakeholder relations (shareholders, media, competitors, governments and many others) can help the corporation benefit from a strong and well-managed corporate branding strategy. The organization becomes more transparent than ever before. This, in turn, elevates the importance of a healthy organizational culture.
Not surprisingly, a strong and comprehensive corporate branding strategy requires a high level of personal attention and commitment from the Chief Executive Officer (CEO) and the senior management to become fully effective and meet the objectives. Product brands typically remain the part of middle management marketing function, whereas corporate brands entail a strategic perspective, based in the executive office. As it carries corporate name and logo, even failure of single product will have impact on other products. Corporate brand decisions are finalized by the corporate people.
A third contrast between product and corporate branding is the targeting segments. While product brands, mainly target customers, corporate brands target all its stakeholders (community members, investors, partners, suppliers and other interested parties) including customers. Instead of relating to consumers through a variety of individual products and services with distinct product brand names, the corporate brand relates all of the organization’s multiple stakeholders and its products and services to each other through their relationship with the corporation.
A fourth difference between product and corporate branding involves defining the branding effort responsibility. Corporate branding requires much more complicated and sophisticated organizational practices than the product branding (for related arguments refer: Harkness, 1999; de Chernatony, 2001; and van Riel and Charles, 2007). Whereas product branding could be handled within the marketing department of a company, corporate branding requires organization-wide support.
The whole organization from top to bottom and across functional units is involved in realizing the corporate brand, along with the audience the brand is meant to attract and engage. Any successful corporate brand is formed by the interplay between strategic vision, organizational culture and the corporate image held by its stakeholders.
As this range of issues significantly over-extends the expertise of the typical marketing department, we believe that successful corporate branding involves the integrated efforts of all organizational departments (e.g., operations, marketing, strategy, communication and human resources).
Balmer (2001a, b) argued that deliberate and orchestrated communication of corporate brand depends on the total corporate communication mix because corporate branding requires integration of internal and external communication, as well as creating coherence of expression across a multiplicity of channels and news media.2,3
Most of the corporate brands are using the umbrella advertising strategy, i.e., projecting their corporate identity in the advertisements rather than Product features or product benefits. For Instance, LG is entering into FMCG market by capitalizing its corporate image. In its advertisements of toothpastes, soaps, shampoos, LG is focusing its corporate name LG, rather than products’ features.
Importance to the Company
Finally, corporate branding is very important to the company because of the greater reach of corporate brands relative to product brands in terms not only of relating past and future, but also of the number of stakeholder groups targeted and the use of the whole company to support the brand.
The corporate branding takes on strategic importance relative to the functional (marketing and sales) importance typically accorded to product brands. The strategic importance of corporate branding lies not only in its positioning of the company in its marketplace, but in creating internal arrangements (e.g., organizational structure, physical design and culture) that support the meaning of the corporate brand.
Corporate branding is often, but wrongly, referred to as an exercise where the company logo, the design style and colour scheme are changed. Naturally, these are important elements to evaluate and potentially change at a later stage once the strategy has been decided upon. It is often accompanied with a new corporate slogan, and then everyone expects results to occur during the project. Corporate branding is a serious undertaking that entails more skills and activities than just an updated glossy marketing facade with empty jargon.
A strong corporate branding strategy can add significant value in terms of helping the entire corporation and the management team to implement the long-term vision, create unique positions in the market place of the company and its brands, and not in the least to unlock the leadership potential within the organization. Hence a corporate branding strategy can enable the corporation to further leverage on its tangible and non-tangible assets leading to branding excellence throughout the corporation.
A Framework for Corporate Branding
A strong corporate brand acts as a focal point for the attention, interest and activity stakeholders bring to a corporation. The corporate brand attracts and orients relevant audiences, stakeholders and constituencies around the recognizable values and symbols that differentiate the organization. But, corporate branding is not only about differentiation, it is also about belonging. Corporate brand expresses the values and/or sources of desire that attract key stakeholders to the organization and encourage them to feel a sense of belonging to it.
It is this attraction and sense of belonging that affects the decisions and behaviours on which a company is built. A strong corporate brand taps this attractive force and offers symbols that help stakeholders experience and express their values and thereby keep them active. Figure 1 shows our framework for understanding corporate branding as Underpinned by processes linking strategic vision, organizational culture and corporate images.10
The central idea behind the company embodies and expresses top management’s aspiration for what the company will achieve in the future.
Organizational culture contains the internal values, beliefs and basic assumptions that embody the heritage of the company and communicate its meanings to its members; and culture manifests itself in the ways employees feel about the company they are working for.
Corporate image denotes the views of the organization developed by its stakeholders; the outside world’s overall impression of the company including the views of customers, shareholders, the media and general public. These elements are interconnected to one another to build the successful corporate brand. The following session explains the interdependence of these elements.
Strategic Vision and Organizational Culture
Collins and Porras (1994) defined the vision as “what the organization aspires to be in the future”.6 However, the research conducted by these authors demonstrated that successful companies build their visions from redefinitions and reinventions of core values rather than revolutionary shifts from one value set to another.
Vision must connect authentically with the heritage of the company. By implication, strategic vision and organizational culture are strongly linked and there is a need for perceived long-term mutual support between them. Balmer and Soenen’s (1999) study of identity management practices among leading UK identity consultants confirms that attempts to manage corporate identity are driven by relating vision to changes in corporate strategy.4
In the area of organizational culture and identity, scholars have long made distinctions between values based on normative versus behavioural contexts. Balmer and Soenen (1999), and later Balmer (2001a) have similarly generated a range of corporate identities from actual to ideal identity based on the recognition that how people act in organizations does not always correspond with their stated intentions or aspirations.2, 4
Based on these insights, it can be found that the concept of organizational culture held by most corporate branding practitioners is rather naive. For the most part they fail to distinguish between desired values (such as those contained in many vision statements), and the emergent or practiced values at work in the organization (current organizational culture).
Organizational culture may be a source of competitive advantage, but only when brand values are reflective of organizational culture and its core values. This requires careful reflection on the present organizational culture and an awareness of the tension between how this culture has been expressed historically, and strategic visions for its future.
The stretch between vision and reality is in line with Senge’s (1990, p. 155) notion of ‘creative tension’, about which he stated: “An accurate, insightful view of current reality is as important as a clear vision”.
To create an authentic corporate brand, the company should build on the cultural values that produce the (often tacit) symbolic meaning of the organization. Since culture is deeply embedded in organizational behaviour, brand values based on credible cultural expression will serve to create genuine coherence between the promise the brand makes and the performance the corporation delivers. This implies that organizational members are important contributors to the creation of corporate brand value. The corporate brand most likely to succeed is one that directly connects strategic vision and organizational culture.
Organizational Culture and Corporate Images
Aaker (1996) argued that when brand values are consistent with organizational culture and company values they will create credibility in the eyes of key stakeholders (e.g., an innovative organization, a trustworthy organization, liked and/or admired organization).1 In the case of corporate branding, we take the argument even further, claiming that alignment between perceived corporate image and actual organizational culture magnifies awareness among all stakeholders about who the corporation is and what it stands for, and enhances organizational attractiveness and reputation.10
Corporate branding efforts generally involve projections of the company’s distinctiveness by using the total corporate communication mix to impress external audiences, who are thereby encouraged to perceive and judge the company and its multiple offerings as attractive and desirable.
Such images are expected to influence stakeholder behaviour in ways that generate brand equity at the corporate level.13 Successful corporate branding requires that corporate images also be related to the organizational culture and thus the values will be based on the everyday behaviour occurring within the company.
Relations between image and culture can unfold in different ways. Managers who are sensitive to the images that others form of their organizations will be better at developing successful, sustainable corporate brands because they will benefit from recognizing tensions or discrepancies that arise between strategic vision and the corporate images held by key stakeholders. When they also learn to bring organizational culture into this equation, they will be in a position to better manage their corporate brands.
Tools Used to Measure Corporate Brand
Core brands use ‘core brand power’ to find out the strength of the corporate brand. It is simple and logical.5 Familiarity rating is based on each respondent’s own familiarity with the company based on a five point scale, from ‘unfamiliar’ to ‘very well known’.
The respondents who have some familiarity with a company then rate ‘favourability’ on a four point scale, according to three attributes: overall reputation, perception of management, and investment potential. Together these attributes form the favourability score. Then the scores are combined to establish its score on a scale of 0 to 100. The score is tracked over time and against competitive companies (refer Figure 2).
Leading brands have both high familiarity and high ‘favourability’. The challenge is to maintain their favourable positions. Promising brands score low on familiarity but high on ‘favourability’. They have an opportunity to enhance their corporate brands through increased communications. Infamous brands are those with high familiarity but low favourability.
The opportunity here is to repair the damage and make sure that the world finds about it. Challenged brands are those with low scores on both familiarity and ‘favourability’. Many organizations try to manage corporate images through a mix of corporate advertising, corporate storytelling, customer relation management and other marketing communication and PR techniques like press conferences and staged media events).
If there is any Uncomfortable gap exists between organizational culture and the images held by other stakeholders, that gap can only be narrowed by listening to the views stakeholders offer on the corporation and confronting the culture with them.
ACID Test of Corporate Identity Management
Researchers and academics of corporate identity management tried to secure the method that reveals a company’s identity and diagnoses an appropriate program thereafter. John Balmer and Soenen (1999), developed the model called ACID Test which aims to reveal and examine the corporate identity and furthermore to diagnose an appropriate program of change.
This model adopts the simultaneously strategic and functional approach and is designed to initially identify weakness in an organization’s identity strategy and subsequently directs the organization towards the appropriate corrective action. ACID Test focuses on the interfaces among four types of identities:
- Ideal; and
The ACID Test of Corporate identity management (refer Figure 3) was developed by the Balmer and Soenen. They suggest that the model should be innovative and reflects cutting edge developments with regard to corporate identity research. It should be capable of being operational zed by consultants. It should be capable of improving current best practices in relation to corporate identity consultancy and management. It should assist in the evaluation of corporate identity programs and management. It should be memorable and simple.
A = The Actual Identity: What is the organization?
C = The Communicated Identity: How is the organization perceived by its public and does it communicates?
I = The Ideal Identity: The optimum positioning of the organization in its market taking cognizance of its strengths and abilities in addition to environmental considerations.
D = The Desired Identity: The identity which the chief executive and management board wishes to acquire.
ACID Test entails three-stage process. The stages are:
- Revelation of the four separate identities;
- Examination of the interfaces among these identities; and
- Diagnosis of the action that needs to be taken to minimize inconsistencies.
Research Method for Revealing the Four Identities
The research approach is needed to find out the identity elements to be researched. The appropriate techniques of data collection should be implemented. Table 2 provides the details:
Successful Stories of Corporate Brands
In 1990, International Business Machines Corporation (IBM) was riding high as its Vice-President of Worldwide Marketing Management and Integrated Marketing Communication described it as a large, almost unstoppable, successful company. IBM had been a business superpower for almost 80 years. But something had begun to happen on the periphery of IBM’s collective vision.
The PC revolution had started, shifting the market to distributed computing and client server. A sea change in the industry caught IBM unawares. By early 1993, IBM’s reputation had slipped significantly12. The market increasingly saw it as a poor investment. That same year, Louis V Gerstner Jr. joined IBM as Chairman and CEO. His dramatic first step was to cancel Predecessor Company’s previous scheme to break up IBM into a loose network of ‘Baby Blues’ built around different products.
Since 1950s, IBM had been fragmenting itself into increasingly autonomous business groups. These divisions had the freedom to create their own identities, their own brands, even their own names, logos, and graphic standards. As a result, many IBM divisions were no longer recognizable to the public: Adstar offered data storage, Edquest offered education products, and Integrated Systems Solutions Corporation (ISSC) handled global services.
The IBM name was being diluted, and the small niche brands were not going to get traction in an expanding marketplace. Gerstner made a decision to change the nature of IBM at its very core. From that moment, IBM was going to be an integrator, a provider of business solutions. Instead of having multiple niche businesses within the IBM framework, IBM was going to be a ‘non-niche’ player, with services, rather than products, driving the company forward.
In 1994, IBM dismissed 75 ad agencies (The Newyork Times, 1994) and created a powerful marketing partnership with global advertising leader Ogilvy and Mather. Between 1994 and 1999, IBM invested $2Bn to change its image and integrate its brand message.
Consolidating IBM’s brand, voice, and management direction proved to have a strong economic value. In 1994, IBM reported its first profit in past four years. In 1995, Gerstner introduced a new vision for the IT industry that networked company would drive the next phase of industry growth and called this phenomenon ‘e-business’.
IBM and Ogilvy extended the IBM brand and its e-business campaign into every facet of their communications, from advertising to events, direct marketing, Internet marketing, product design, and employee training. IBM believed in integration and a 360-degree approach. In 1999, the company spent $75 million on advertising that showcased its consulting expertise (IBM Global Services). In a decade of unprecedented technological change, IBM reinvented its corporate brand not only to be a part of the revolution, but to lead it.
Virgin, antiestablishment brand uses one corporate name, logo and style in all its markets and across all its businesses by associating this symbolism with generic product labels like Virgin Mega stores, Virgin Atlantic, Virgin Express, and Virgin Trains so on. Furthermore, Virgin uses Branson, the founder, as highly visible component of its corporate symbol system. A recent independent research study has shown that the UK public vote Virgin as their most admired brand.
A sample of 2,000 adults was asked “which brands or companies can you think of that you really admire?” Virgin received more votes than any other brand with 23% of votes. Virgin has created more than 200 branded companies worldwide, employing approximately 50,000 people, in 29 countries. Revenues around the world in 2006 exceeded £10 billion (approx. $20 billion). Whether the holding is large or small, there seems good reason to plaster on the Virgin logo: According to an April 2007 survey by HPI Research, British consumers voted it their most trusted brand, even before Sony.
A good example of cultural branding can be cultural branding Manchester united big brand idea is a cultural brand strategy so that it can be positioned as a European leader in football. Manchester desires to champion this cultural brand idea it is thinking of doing it first locally, then nationally, finally, globally.22
Note that the above processes of cultural-meaning creation and redefinition occur over time and involve many different fragments of society, e.g., consumers, companies, technology, political and cultural institutions. Given this complexity, it is difficult to design specific studies to explicitly model these mechanisms and their directionality that are not de-contextualized or overambitious.
Accordingly, in the present research, we focused instead on providing insight into a slice of this phenomenon by examining some of its perceptual and structural elements: how individuals organize the symbolic and expressive attributes associated with commercial brands and how this organization may vary across cultures.21
Volkswagen provides a safe car that with a good for environment system. And it help for environment, will not make pollution to damage atmosphere. Do the best in quality vehicle sales and service and to continue to enhance our long-standing reputation of fostering a family atmosphere that creates high employee loyalty and customer satisfaction.
Volkswagen’s market share is growing and it is standing in 9% market share in the global car market. And we want to position the Volkswagen brand as a global leader in the quality car market20. There is a Association is called Australian Automobile Association that concern about the environment on greenhouse issues that are encompassed in the paper climate for change – global warming and the Automobile. Also, they did a survey about this, there are 75 percent of motorists said they were concern about the effects of the cars on the environment, with 22 percents stating extreme concern about this.
So we developed the good fuel system that in the fuel standards. Today’s global market demands products that are simultaneously an emanation of their place of origin and an interpretation of their target markets, as well as inherently innovative and original on their own account.22 And small car yet densely packed with technology that also says something about its country of origin in the way it epitomizes one of the basic concepts of Japanese culture: its ability to pack a lot of activity into very limited spaces.
Product strategy should enhance the pre-existing image – compact and cute car and the Volkswagen corporate name. This family-branding strategy of the New Beetle cabriolet is an effective tactic to strengthen existing brand awareness, corporate name and create new awareness for the product. So they should enhance their brand when the advertise and etc.19
Thus in my research I discuss the importance of the Brand for the consumer and all the strategies regarding the creation, the planning and the development of different strategies in order to reach the best profits. Brands can have extraordinary powers of influence. After all, it is the brand, not the product or the corporation that wins the consumer’s loyalty.
A brand may provide confidence to the consumer about the quality of the product and gratification of image of self. The process of giving a name or brand affiliation to a product has developed rapidly this century. Brand marketing grew alongside the consumer society, supported by the surge in consumer durables and the expansion of commercial television. It is easy to see that for the business, branding is the most essential detail to reach the success.
It is a way to create a communication between producers and consumers. It takes a lot of time and talent to create a good brand. The brand is an increasingly important concern for marketing researchers and practitioners. Branding gives consumers the assurance that their next purchase of a product will give them one which is virtually identical thus it can be said that mindshare, emotional, cultural and viral branding are all core branding strategies.
An ancient and famous proverb says: “If you don’t have a goal, how can you know when you have arrived?” In order to establish and grow a corporate brand successfully, the management team has to track and measure the strength of the current corporate brand and the entire brand portfolio. ‘Corporate Branding’ scores well on the dimension of economics.
Investing in a single brand name is less costly than trying to build a number of brands. By leveraging a common name across a variety of products, the brand distributes its investment. Hence corporate branding works out to be an economical strategy. Using a corporate brand to enter new markets allows considerable savings.
The brand bestows the new product advantages of brand awareness, associations and instant goodwill, i.e., the product inherits all of them from the brand pool simply by taking on the corporate name.
Corporate branding also suffers from some of the limitations. The biggest limitation is that it has to maintain consistency among its all product categories. Another disadvantage associated with this strategy is that since many products share the common name, a debacle in one product category may impact the other products because of the shared identity. Corporate branding may be appropriate when markets operate at a higher level of aggregation.
The founder of Sony, Akio Morita, once said: “I have always believed that the company name is the life of an enterprise. It carries responsibility and guarantees the quality of the product”. A strong and well-balanced corporate brand orchestrated throughout the corporation by a passionate CEO and his team can lead to very successful and sustainable financial results.
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