Conceptual Framework of Corporate Branding - Assignment Example

Branding & Communication Programme: Module Module Module Session: Month, Year Assignment Question Full ID Number: Assignment Word Count: Submission Date: Contents Contents 2 Introduction 3 Conceptual framework of corporate branding 4 Difference between corporate branding and product branding 7 Implications for companies and consumers 10 Relevant examples 12 Conclusion 15 References 17 Introduction This study shall focus on different aspects of corporate branding. Corporate branding is all about promoting corporate entities. Brand name of corporate entity is given importance in corporate branding and this distinguishes it from service or product branding. The scope of corporate branding is much wider in comparison to product branding. There are distinguishable characteristics prevalent in all three forms of branding. Branding activities play a vital role in enhancing corporate image. Corporate brand architecture encompasses interaction of one brand with another. There are multiple stakeholders affected by corporate branding such as investors or employees. Impacts created by corporate branding can be determined in terms of evaluation of services or products, corporate culture and identity, brand extensions, employment applications, sponsorship, etc. Brand refers to design, name or term that can differentiate one product from another. Branding concepts are widely used in advertising campaigns, business and marketing activities. This study would comprise of implications of corporate branding. These implications shall be determined in context of both consumers and companies. Corporate branding examples will be included in this study in order to analyze consequences of corporate branding strategy. This approach facilitates economies of scope and initiates rapid new product acceptance. The reason being potential buyers are more familiar with brand name. There are negative implications of corporate branding. It reduces scope for positioning of a particular brand. Different products encompass unique characteristics and this in turn requires distinguished branding activities. Multiple touchpoints can be effectively incorporated by branding. Corporate branding is not confined to any specific name or mark. The touch points emphasized on by branding approach are customer service, training and employee treatment, logo, product or service quality, advertising campaign, stationary and packaging. Brand is usually considered to be an intangible asset of a company. It is most valuable asset of any organization since it enables customers to strongly associate with any corporate brand. Brands are efficiently managed by owners so as to provide value to shareholders. This study will also comprise of differences between product and corporate brand, along with their symbolic and functional attributes. Effective corporate branding strategies not only initiate high sales margins but even guarantee long term customer relationship with corporate. Conceptual framework of corporate branding Corporate branding concept is aligned with holistic approach, and this indicates team members to exhibit behavior as per brand identity. Corporate identity is basically stated as values, ethos and aims of an organization. Individuality is encouraged through this approach and it eventually differentiates one brand from another. A model on brand management stated the reduction in gap between brand reputation and identity (Allen, 2006). Figure 1 highlights the various aspects of brand management model. There are certain unique components of brand identity like culture and vision, subsequent relationships and brand personality, inspirational or actual self-images of stakeholders. The identity-reputation gap model has been outlined in figure 1. Figure 1: Identity-reputation gap model (Source: Churchill, 2009) As per figure 1, culture and brand vision are essential components of brand identity. Vision is related to core purpose of a brand. Managers should be able to communicate the purpose of brand to employees (Oliver, 2007). Corporate culture is regarded as a major source of competitive advantage. Positioning is another aspect of this model and it refers to what brand stands for, what it offers and its target audience. Brand personality is emotional characteristics closely knitted with a brand identity. The core values of a brand are associated with personality aspect. Relationships are developed on basis of values encompassed within brand personality (Barney, 2006). This clearly portrays relationship building between consumers and brand name. Presentation is a critical component of brand management since it reflects upon aligning brand identity with consumer aspirations. Brand reputation can only be developed when there is positive past actions of a brand and it is able to deliver expected value to all its customers or stakeholders. A corporate brand is stated as a product of corporate strategy, activities, mission and image of an organization. This approach helps in distinguishing a particular organization from that of other players (Hoskisson, Hitt, Duane and Harrison, 2007). It even helps in creating a perception amongst target audience. Product branding is deeply integrated with highlighting specific characteristics of a product. On the contrary, there is widespread advantage of corporate branding mechanism. The importance of corporate branding can be evaluated in terms of trust, care, relationship building and rewards. Trust through corporate branding approach is incorporated within all stakeholders. Relationships are enhanced in context of rewarding brand experience, authenticity and embracing power of consumers. Care is initiated by corporate branding through facilitating strong engagement with all community members. Corporate branding is a conscious decision undertaken by senior management in order to bring forth organizational identity as a branding proposition (Alba and Hutchinson, 2008). There exist three virtues of any corporate brand such as communicate, differentiate and enhance. Corporate branding is solely responsible for developing brand reputation. It is an element which is easily identifiable by all customers and this is transmitted across wide range of products. Corporate brands are usually standardized for any organization and are effectively incorporated within internal operational procedure (Simpson, 2009). Product branding or marketing activities are associated with selling of goods. On the contrary, corporate branding is all about selling an organization. Communication tools needs to be appropriately chosen in order to initiate corporate branding activities. Corporate branding can be stated as a formative and expressive device. This approach is a structural dimension to align capabilities or resources of a company to address market demand and external factors (Fill, 2006). The importance of corporate brand is not only related to expressing cultural values or company’s aspirations, but it even streamlines organizational structures or processes to address such aspirations. Corporate branding is closely knitted with external and internal organizational spheres. Internal constituencies usually receive corporate brand message and it causes impact on internal aspects of a firm. Corporate brands usually develop an interface between external and internal organizational areas and then establish a link in most interdependent format. This type of branding approach is a shared property and is not linked with any specific sphere. Stakeholders like employees play a significant role in supporting internal dimension of corporate branding activities. There is always a balance established between external and internal aspects of an organization (Batey, 2012). The internal aspects like corporate vision and corporate identity is basically stable over an extended period of time for an organization. On the other hand, external aspects frequently change in order to be aligned with external conditions. Difference between corporate branding and product branding There exist structural differences between corporate branding and product branding. In earlier years, companies used to focus only on product branding or differentiation strategies. This concept has changed in recent scenario. Product differentiation strategy is not the only means to gain competitive advantage. This is simply because competitors are able to imitate product related strategies and it reduces scope to sustain long term competitive advantage. The era of corporate branding has enabled companies to highlight their emotions and values. These factors enhanced by corporate branding are a means to encourage competitive differentiation. On basis of corporate branding, client attention is rapidly shifting from product characteristics towards corporation (Keller, 2008). The shift from product branding to corporate branding enabled organizations to gain higher profit margins. Product branding mainly deals with specific characteristics or features of products. On the contrary, corporate branding encompasses beliefs and ideologies of an organization. Organizational behavior is greatly outlined through this approach and it even includes employee interactions as brand ambassadors. Organizational culture health can be stated as another dimension which differentiates corporate branding from that of product branding. Healthy organizational culture is an important aspect simply because there is increasing focus on organizational and employee behavior. Brand management plays a vital role in shifting consideration from product to strategic level. Customer focus and stakeholder focus are two important concepts which differentiate corporate branding from product branding. Brand’s target audience can be stated as another differentiating factor between product and corporate branding. It is observed that consumers are usually targeted by product brands (Ambler, 2005). On the contrary, corporate branding is inclined towards addressing all stakeholders of a company. These stakeholders are partners, industry groups, suppliers, community and interested parties. Multiple stakeholders are taken into consideration during corporate branding activities. Branding responsibility usually differs across product and corporate branding strategies (Fetscherin and Usunier, 2012). Product branding is related to actions undertaken by marketing departments of an organization. Organization wide support is the most important factor in context of corporate branding. Corporate brand are structured on basis of an interplay set between corporate images, strategic vision and organizational culture. Integration amongst all departments is vital in order to accomplish objectives of corporate branding. External communication channels needs to be effective in case of product branding but corporate branding demands for a synergy between external and internal communication channels (Cheverton, 2005). This form of strategy ensures that a single message is being communicated across target audience. Product brands are aligned with present market scenario and it witnesses change with time period. On the other hand, corporate brands are basically aligned with future and past business conditions. They represent a symbol of organizational vision and heritage. Both these factors constitute overall stakeholder equity. Strategic importance linked with corporate brands is considerably high in comparison to product branding concept. Their importance is not only confined to market place positioning but also involves developing internal arrangements such as culture and physical design, support and organizational structure. Relationships build by corporate branding is completely different from product branding. In product branding, focus is on establishing customer-brand relationship. There are wide array of product features which are highlighted in product branding activities (Franzen and Moriarty, 2008). The main aim of companies in such activities is to enhance sales margins of products and retain specific position in the market place. However relationship in corporate branding is not confined only to customers. It encompasses all external and internal stakeholders who possess some form of attachment with company image. There is importance given to organizational structure, ethics, values and culture in corporate branding approach, so as to ensure that all stakeholders are aligned with organizational objectives. The most relevant stakeholders of corporate brands are employees, customers, suppliers, retailers, etc. Relationship building is essential both for product brands and corporate brands. In product branding, relevant relationship is with customers, since it initiates revenue margins. On the contrary, corporate branding is enhanced with effective relationship between company and external or internal stakeholders. Stakeholders need to understand values and culture of an organization which is portrayed in corporate brand design. Functional attributes of corporate branding deals with core purpose or functions of an organization. These attributes resembles operational procedure being focused on by an organization (Onkvisit and Shaw, 2009). It simplifies understanding of a stakeholder regarding different actions encompassed by a firm. Symbolic attributes reflect upon characteristics of customers as well as other stakeholders. Innovative logos or brand image is portrayed as symbolic attribute so as to convey corporate message. Product brands contribute towards functional attribute of corporate branding in order to highlight important characteristics of offerings. Implications for companies and consumers The implications of corporate branding are highly distinguishable in context of companies and customers. Product evaluation by customers is greatly affected by corporate branding components. Corporate name is expected to have significant, positive and direct effect on customer’s perception. An organization is not able to control customer’s perceptions but firms on basis of its name can enhance corporate image. Corporate branding not only plays a significant role in terms of developing corporate image but even influences perception of consumers. Consumers purchase products based on effectiveness of corporate image. Image building is an important aspect which is structured with the support of corporate branding activities. Corporate image greatly affects purchase decision making process of customers and perception about credibility or product quality of a company. This factor can directly as well as indirectly affect product evaluation of customers. Corporate reputation is a vital factor in relation to influencing attitude of customers so as to purchase a product (Codita, 2011). The importance of corporate reputation increases with value of products or services. For instance, corporate reputation becomes an essential component for customers during purchasing products such as automobiles. Corporate reputation is also witnessed to affect the degree of corporate loyalty (Pringle, 2008). In overall context it can be stated that corporate image has a direct impact on consumer behavior. Corporate commitment is increasingly gaining importance for all those organizations who are seeking towards improving market position. The overall impact of corporate image and corporate loyalty is reduced in presence of corporate reputation and corporate name. Customers are often observed to purchase products based on corporate reputation in the market place. This form of reputation comprises corporate loyalty in consumer market segment. Customers buy corporate image rather than products in current scenario. This is simply because products can be easily imitated by competitors but corporate image or shared values cannot be included by other companies (Ulwick, 2005). It helps firms to establish a distinguishable feature in the industry. Corporate image is an important branding strategy since it outlines different functional and symbolic attributes which plays a significant role in consumer decision making process. Corporate branding is also responsible for holding significance in context of businesses. There are some corporate that have become famous in every other household such as Nike, Virgin Group, etc. These organizations are currently renowned because of their strong branding initiatives. Corporate brand basically encompasses a logo, specific colors, trade name and a slogan. These elements can be combined in such effective manner that companies are known by images rather than names. Corporate branding is essential for all business organizations because of wide array of reasons. Firstly it develops identity for businesses. Logo or slogan in corporate branding is regarded as the face of the business (Belohlavek, 2008). Even if the name is not highlighted, companies can be known to target audiences through brand elements. Customer relations in business organizations are facilitated through corporate branding mechanism. It is observed that customers are able to quickly relate with corporate image when there is a strong brand identity. Value addition is another implication of corporate branding on businesses (Gelder and Woodcock, 2003). Corporate branding activities is a medium through which sale ability and value of a company can be improved for future years. In mergers and acquisitions it is observed that companies pay billions or millions. This is not for the company being acquired but for its most valuable asset – brand image. Long term success of any brand is totally dependent on investment made towards building strong brand image. Professionalism is another aspect enhanced through corporate branding. A strong brand image tends to make a company more polished and professional in comparison to other competitors. This aspect is taken into consideration not only by customers but also by organizations that might prefer to indulge into partnership. Corporate branding can also be referred to as a sign of quality. Branding is a sign of high quality along with offering superior quality of products or services (Schultz, Hatch and Larsen, 2000). Customers shall align high quality offerings with brand name and this would transform brand identity as a resemblance of quality. Businesses will gain high revenue margins since branding will disclose corporate values. This in turn shall facilitate higher degree of trust between customers and organization. Customers are observed to purchase products because they trust a particular brand. Relationship building and trust plays a vital role in long term or short term success of a company (Simerson, 2011). Businesses can expand in future years only when there is a wide base of loyal customers and increased trust level amongst industry members. Relevant examples Corporate branding activities basically changes from one firm to another. The story of Unilever is prominent in the fast moving consumer goods industry. This company was incorporated in 1930 with the merger of Lever Brothers and Margarine Union. The name of this new company was derived from names of existing partners. Unilever is the leading company in Personal Care and Foods & Home segment. This company builds its corporate brand by structuring a new mission. Mission of this organization was to include vitality to life. Unilever’s brand message is to address needs for hygiene, personal care and nutrition of individuals (Fill, Hughes and Francesco, 2013). The big idea behind this company’s corporate branding is represented in figure 2. Figure 2: The Big Idea (Source: Proctor, 2014) Corporate brand of Unilever is deeply rooted in vitality mission of the organization. There is an integration established between environmental, social and economical impacts. Customers have high trust level associated with this brand name. This trust level is able to distinguish Unilever brand from that of other FMCG companies like Nestle, P&G, Kraft, PepsiCo, etc. Corporate identity usually enables customers to identify an organization and its functions. Disney, McDonalds and Disney are key examples which highlight the mechanism of corporate branding. The name of Nike in current scenario also does not need to be outlined but ‘Swoosh’ word itself is sufficient to determine brand name. This can be stated as significance of corporate branding on consumer mindset. Corporate identity is strongly associated with three important components like monolithic, branded and endorsed. Monolithic identities are observed in companies where similar logo and visual style is being utilized (Russell, 2009). The corporate identity mix in this scenario is standardized and slight variations are included across product line. However standardized brand image initiates instant recognition of parent company name (Bruner, 2007). This methodology has been adopted by companies like Shell and BMW. BMW is indulged into re-creating its corporate brand image with fluctuating consumer market taste and preferences. The logo of the company accounts for its corporate reputation as elaborated in figure 3. Figure 3: Corporate branding of BMW (Source: Balmer and Greyser, 2003) Corporate branding of BMW is not only responsible for driving customer attention but is also inclined towards providing value added services to external and internal stakeholders. Negative implications on customers are observed when product or services being offered is not able to satisfy consumer market demand. Proctor & Gamble (P&G) is well known for its wide array of products but certain product features might not be able to address consumer market demand. P&G encompasses a unique logo that helps to gain customer attention and set forth a positive corporate image. The logo of P&G states – “make every day better.” P&G over the years have been able to set up a strong corporate image not only by offering superior quality products but also through other commitments such as educational programs, environmental initiatives, etc (Hatch and Schultz, 2008). Corporate branding plays a significant role in context of developing a market place image. For instance, brand image developed by Nestle cannot be imitated by any other rival firms. To be more precise this company emphasizes on relationships and associates each of its products with some form of natural event or relationship. Corporate identity of Nestle also comprises of importance of stakeholders (such as employees) in order to manufacture quality products for its consumer market segment (Caruana and Chircop, 2000). The sales margin of luxury product items is dependent on effectiveness of corporate brand identity. Rolex is a prime example in this particular product segment. Customers purchase Rolex watches because of their product quality and innovative designs. It mainly symbolizes self-esteem and social strata. Symbolic attributes of this brand influence customer’s decision making process (Hastings, 2013). IBM is another example of corporate branding which has significance on the business activities and employees. IBM utilizes employees as a major part of their advertisement campaign. Team members of IBM highlight those corporate values which the company promises to pass on to its customers. Conclusion As per the study, brand management is an important conceptual framework. There are different entities encompassed with branding activities. Brand building activities are encouraged by an organization because it initiates acquiring high revenue margins. Corporate branding was the major area of concern in this particular study. It can be stated that corporate branding as a concept is highly distinguishable from product branding approach. Product branding is associated with product features and promotional campaign. On the contrary, corporate branding is solely responsible for creating an appropriate corporate image. In many circumstances it is observed that customers can easily identify a brand logo or image before they could recall brand name. This form of strong association usually develops when effective corporate branding activities are exercised by a company. Corporate branding reflects culture or values of an organization. Organizational structure and culture holds significance in relation to company success and growth. This cultural aspect is outlined in corporate branding. The major aim of such branding is to enhance corporate image in front of target audience. Customers should be well aware about company’s core values since it greatly influences buyer’s behavior. It is observed that frequent changes are incorporated in product branding. The reason is changing taste and preferences of consumer market demand which initiate changes within product branding approach. Product features is closely knitted with product branding mechanism. On the other hand, corporate branding relates to overall image being developed of a company. It eventually represents all products existing in product line or any new launches. This study has even focused on certain real world organizations that have given importance to corporate branding. There are firms occupying magnificent position in the industry due to their corporate identity. Corporate branding has widespread implications on customers as well as companies. 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