Brand Internationalization through Brand Identity and Alignment

220 Pages·2013·4.13 MB·English

Brand Internationalization through
Brand Identity and Alignment
The case of Swedish Outdoor SMEs

Authors: Maria Göppel

Ruth Omonigho Mrabure

Supervisor: Zsuzsanna Vincze

Student
Umeå School of Business and Economics
Spring semester 2013
Master thesis, two-year, 30 hp
Acknowledgement

First and foremost, my thanks go to my great partner Jonas whom supported me during
the entire phase of this thesis. Furthermore my gratitude goes to my dear best friend
Anna and my lovely grandma.
- Maria
My gratitude goes first to God almighty the giver of wisdom and knowledge, who has
being my source of inspiration. My heartfelt appreciation goes to my brother Charles O.
Mrabure for his support and care all these years. To my sister Efe Bakare and her
husband Olalekan Bakare, thank you for your prayers.
I won’t fail to mention Akiri Ese who has being a sister and a friend, a confidant and
role model to me. To my Mentor George Ashiru and Chief Mrs Joy Agbah, I am
grateful for all your wise counsels that have guided me immensely. To all my friends,
thank you so much for your help all through and words of encouragement when I
needed extra strength to push through this process.
- Ruth
We really appreciate each other’s efforts and commitment to this work, we had times
where we needed to push through in order to make it; but we happily succeeded at the
end. Our gratitude goes to our supervisor Zsuzsanna Vincze for all her valuable inputs
that helped us tremendously; in building up this enormous task.
We also appreciate Johan Svensson for his statistical assistance. Most of all, we would
like to thank the three companies that participated in this study, for their time and
interesting insights; without which we would not have been able to conduct this
research. We say thank you to all those who took our surveys all over Europe and other
countries.
To Jonas and Frances Kadiri for accepting to proof read this long work, we really owe
you our heartfelt gratitude for the hours you put into reading our manuscript.
Last but not the least; we would like to thank all those who helped us in one way or
another and our fellow students for their valuable recommendations.
- Maria and Ruth

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Abstract
A brand is more than a product and small-medium-enterprises (SMEs) have the
possibility to exploit the full potentials of branding. Even when currently still
underestimated, branding provides benefits for SMEs. The outdoor industry is one that
is becoming a mainstream market with several brands competing for the outdoor
enthusiasts in potential markets all around the world. Branding is an integral part of
businesses today and the dynamic nature of business in this 21st century makes it even
more competitive in nature because every firm has to differentiate its product from
those of competitors one way or another including SMEs who are faced with several
constraints. This is why it becomes imperative to be entrepreneurial in their marketing
efforts and ensure that employees understand what they want the brand to stand for in
the mind of customers. Branding could enhance their position, competitive advantage,
performance as well as international expansion.
The purpose of this study is to explore how Swedish Outdoor brands (SODBs) build
their brand identity and align their brand for international markets. Furthermore, the
research aimed at finding out if the intended brand identity is in line with the perceived
brand image by customers. The research outcomes can be used by Swedish Outdoor
companies that want to inform themselves about brand management in general and
different opportunities on how to build a unique brand identity that is internally as well
as externally valued. It provides practical considerations for entrepreneurs and SMEs in
general on how to aim at building a brand that is strong how they could internationalize.
In order to adequately explore the aim of this study, a mixed method of qualitative and
quantitative research was undertaken. The first phase of data collection was done with
three SODBs through semi-structured interviews and it was qualitatively analysed. This
served as an input in the preparation of the questionnaires used in the second phase of
data collection from retailers and end-users mainly across Europe. Two questionnaires
were developed for both groups. The responses from both groups were analysed
statistically. The data collected from the companies, retailers and end-users enabled us
to compare the company’s perspective with that of the retailers and end-users; which is
a comparison of an inside-out (companies) and outside-in (customers) perspective.
We combined theories from marketing and entrepreneurship which enabled us to
develop a framework that we analysed according to sub-disciplines of both fields in
order to answer the empirical research questions raised in this research. The framework
was modified based on our findings and our findings revealed that the aspired brand
identity of the firms studied aligns with the brand image that retailers and end-users
form about SODBs in the international market addressed in this research. Furthermore,
employer/internal branding activities were evidently seen in all companies studied; and
the level of entrepreneurial orientation in each firm with regards to proactiveness and
risk-taking as well as its impact on the brand creation process. This study contributes to
theories in SME brand management, brand building and alignment with both internal
(employees) and external (retailers and end-users) stakeholders; methodological
contributions in the field of research and provides valuable societal contributions as
well as managerial recommendations for outdoor SMEs in particular and SMEs in
general that want to build and/or internationalize their brand.
Keywords: Brand identity, Brand Image, Brand management, Employer branding,
Entrepreneurial Orientation, Internationalization, SME branding, Outdoor.
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Table of Contents
Acknowledgement .................................................................................................................................................. i
Abstract ..................................................................................................................................................................... ii
List of Tables .......................................................................................................................................................... vi
List of Figures ........................................................................................................................................................ vi
Abbreviations ....................................................................................................................................................... vii
Chapter One-Introduction ........................................................................................ 1
1.1 Problem Background and Discussion .............................................................................................. 1
1.2 Knowledge Gap .......................................................................................................................................... 5
1.3 Purpose of the Study ............................................................................................................................... 6
1.4 Contributions ............................................................................................................................................. 6
1.5 Delimitation ................................................................................................................................................ 7
1.6 Authors Background ............................................................................................................................... 7
1.7 Definition of Key Terms ......................................................................................................................... 8
1.8 Thesis Outline ............................................................................................................................................ 9
Chapter Two- Literature Review ............................................................................. 10
2.1The Brand Alignment Framework .................................................................................................... 10
2.2 Brand Conception ................................................................................................................................... 12
2.3 SME Brand Management and Guidelines ...................................................................................... 13
2.4 Brand Identity and Brand Image ...................................................................................................... 14
2.4.1 Brand Positioning .......................................................................................................................... 18
2.4.2 Brand Associations ........................................................................................................................ 19
2.4.3 Country of Origin Association ................................................................................................... 20
2.5 Brand Equity ............................................................................................................................................. 21
2.6 Employer/Internal Branding ............................................................................................................. 22
2.7 Entrepreneurial Orientation .............................................................................................................. 23
2.7.1 Entrepreneurial Orientation and Performance ................................................................. 24
2.7.2 Entrepreneurial Orientation and Culture ............................................................................ 25
2.8 Internationalization ............................................................................................................................... 27
2.8.1 The Stage Theories and Network ............................................................................................ 27
2.8.2 International New Ventures and Network .......................................................................... 28
2.8.3 SMEs and Internationalization ................................................................................................. 31
2.9 Preliminary Framework ...................................................................................................................... 32
Chapter 3-Methodology ......................................................................................... 37
3.1 Philosophical Approach .................................................................................................. 37
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3.2 Research Strategy ................................................................................................................................... 39
3.3 Research Design ...................................................................................................................................... 41
3.4 Data Collection ......................................................................................................................................... 42
3.4.1 Semi-Structured Interview......................................................................................................... 43
3.4.2 Secondary Data ............................................................................................................................... 44
3.4.3 Questionnaire Design ................................................................................................................... 45
3.4.4 Sampling ............................................................................................................................................ 47
3.5 Ethical Considerations .......................................................................................................................... 48
3.6 Literature Selection ............................................................................................................................... 49
Chapter 4: Empirical Research and Findings ............................................................ 50
4.1 Company Overview ................................................................................................................................ 50
4.1.1 Haglöfs ................................................................................................................................................ 50
4.1.2 Elevenate ........................................................................................................................................... 51
4.1.3 Klättermusen ................................................................................................................................... 52
4.2 Qualitative Data Analysis .................................................................................................................... 53
4.2.1 Haglöfs ................................................................................................................................................ 53
4.2.2 Elevenate ........................................................................................................................................... 58
4.2.3 Klättermusen ................................................................................................................................... 62
4.3 Preliminary Framework Application ............................................................................................. 66
4.3.1 Brand Identity ................................................................................................................................. 67
4.3.2 Employer/Internal Branding .................................................................................................... 69
4.3.3 Entrepreneurial Orientation...................................................................................................... 70
4.3.4 Internationalization ...................................................................................................................... 72
4.4 Quantitative Data Analysis ................................................................................................................. 74
4.4.1 Retailer Questionnaire Analysis ............................................................................................... 74
4.4.2 End-User Questionnaire Analysis ............................................................................................ 77
4.5 Comparable Questionnaire Analysis: Retailer and End-User ............................................... 79
Chapter 5 Discussion .............................................................................................. 87
5.1 SME Brand Management ..................................................................................................................... 87
5.2 Employer branding ................................................................................................................................ 88
5.3 Entrepreneurial Orientation .............................................................................................................. 90
5.4 Internationalization ............................................................................................................................... 91
5.5 Brand Identity and Brand Image ...................................................................................................... 92
5.5.1 SME Brand Identity ....................................................................................................................... 93
5.5.2 Brand Personality .......................................................................................................................... 93
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5.5.3 Brand Associations ........................................................................................................................ 94
5.5.4 Brand Equity .................................................................................................................................... 96
5.6 Revised Framework ............................................................................................................................... 97
Chapter 6 Conclusion ............................................................................................ 100
6.1 General Conclusions ........................................................................................................................... 100
6.2 Contributions ........................................................................................................................................ 101
6.3 Recommendation for Swedish Outdoor Companies/SMEs................................................ 103
6.4 Quality criteria ...................................................................................................................................... 104
6.5 Limitations of the Study .................................................................................................................... 105
6.6 Suggested Future Research ............................................................................................................. 105
References ........................................................................................................... 107
Appendix 1: The Brand Leadership Model ............................................................. 117
Appendix 2: Brand Building and Management LOs & SMEs ................................... 118
Appendix 3: Value Proposition vs Customer Value Types ...................................... 119
Appendix 4: Brand Personalities ........................................................................... 121
Appendix 5: Brand Identity and Association Template .......................................... 122
Appendix 6: Simplified Brand Identity and Association Template .......................... 123
Appendix 7: Reference Letter for Interviewee ....................................................... 124
Appendix 8: Email to Participating companies ....................................................... 125
Appendix 9: Interview Guide ................................................................................ 126
Appendix 10: Interview Guide Development ......................................................... 129
Appendix 11 Interview Guide: Link to Theories ..................................................... 130
Appendix 12: Questionnaires (See below) ............................................................. 130
Appendix 13: Questionnaire Scales ....................................................................... 174
Appendix 14: Comparable Question Overview ...................................................... 178
Appendix 15: Overview of SME Brand Management Guidelines per Company ....... 179
Appendix 16: Qualitative Analysis Summary Table ................................................ 180
Appendix 17: Statistical Analysis Output ............................................................... 184

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List of Tables
Table 1: Brand Management Guidelines of SMEs .................................................................................. 14
Table 2: Brand Identity ..................................................................................................................................... 15
Table 3:Brand Identity Perspectives Aaker ............................................................................................. 16
Table 4: Brand identity vs. Brand image ................................................................................................... 19
Table 5: Philosophical Assumptions ........................................................................................................... 39
Table 6: Overview: Exploratory Sequential Research Design. ......................................................... 42
Table 7: Overview of the respondents and interview information ................................................ 44
Table 8: Demographic profile of participating companies ................................................................ 50
Table 9: Cronbach’s Alpha for Retailers .................................................................................................... 75
Table 10: Cronbach’s alpha End-Users ...................................................................................................... 78
Table 11: Comparison of Brand Recall, Recognition and Connection to Sweden .................... 80
Table 12: COO Associations ............................................................................................................................ 84
Table 13: Brand Personality ........................................................................................................................... 86

List of Figures
Figure 1: Brand alignment framework ...................................................................................................... 10
Figure 2: Brand Personality Factors and Facets .................................................................................... 17
Figure 3: Types of International New Ventures ..................................................................................... 30
Figure 4: Brand Alignment and Internationalization Framework of SODBs ............................. 34
Figure 6: Revised Framework of Brand Alignment and Internationalization of SODBs ....... 99

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Abbreviations

CBBE= Consumer Based Brand Equity
COO= Country-of-Origin
EB= Employer Branding
EO= Entrepreneurial Orientation
FDI= Foreign Direct Investment
INV= International New Venture
LOs= Large Organizations
RQ= Research Question
SMEs= Small and Medium Enterprises
SODB=Swedish Outdoor Brand
SODBs=Swedish Outdoor Brands
TOMA= Top of Mind Awareness

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Chapter One-Introduction
In this chapter, we will present the problem background and discussion for this thesis
and argue for why it is important to look at the selected concepts that may have
relevance on brand identity and internationalization of Swedish Outdoor SMEs. The
knowledge gaps, research questions, purpose of the study, potential contributions and
delimitations of this study are presented as well as the author’s background; and
definitions of key concepts.
1.1 Problem Background and Discussion
The outdoor industry is taking on greater significance, not just for customers focusing
specifically on outdoor sports and activities but, it is also evolving as a trendy fashion in
the cities nowadays. “Outdoor clothing is now about much more than simply fulfilling
the functional criteria of sportswear: it is also increasingly gaining ground in urban
everyday life and setting fashion trends in all areas” (Outdoor-Show, 2012). Many
outdoor fashion brands seem to gain attention and popularity beyond their borders by
delivering high quality and innovative products that benefit from a positive brand
image; and “Scandinavians are known for their love of the outdoors and values of
simplicity, style, quality and durability and their resilience in coping with harsh
weather conditions” (Horne, 2010). The need to create these kinds quality brands
requires some level of creativity from management/employees and ability to leverage on
the changing fashion trends in various markets. Marketing and entrepreneurship has
been considered as behavioural in nature because “they are both boundary spanning,
involve an extensive interplay with environment, require the assumption of risk and
uncertainty, and inevitably interface the complexities of human behaviour with
commercial and other endeavours” Hill & LaForge (1992, cited in O’Cass &
Weerawardena, 2009, p. 1327). An entrepreneurial vision and the ambition to give a
brand a unique identity by building a “bridge” between entrepreneurship and marketing,
which have to be aligned in order to gain benefits from this interrelation.

Brand management is a widely discussed topic since many businesses recognized the
value of brands, which might even be the most beneficial asset for many companies
(Aaker & Joachimsthaler, 2000; Keller & Lehmann, 2006). A brand (see definition in
section 1.7) is a promise to the customer and holds benefits for the consumer as well as
for the company. When speaking about brands, people often have more in mind than a
product since they form perceptions. Therefore, a brand is more than simply a product
and needs adequate management (Aaker & Joachimsthaler, 2000; Aaker 2010). In this
study, we have focused on finding out how Swedish Outdoor SMEs are managing their
brands in order to reach out for an international market. Brand management works
differently for SMEs than for large organizations (LOs). SMEs have to build their brand
identity based on visionary entrepreneurs and passionate managerial teams that strive to
build a unique identity (Krake, 2005; Keller 2008; Spence & Essoussi, 2010). While
facing restrictions regarding limited resources, SMEs are supposed to have advantages
regarding innovativeness and flexibility (Berthon, Ewing & Napoli, 2008; Spence &
Essoussi, 2010). Successful brand management needs a positioning that is based on a
clear and unique brand identity, which is how the company wants to be perceived by
customers. In contrast, the brand image is how the company is currently perceived by
retailers and end-users (consumer). The positioning is the basis of the marketing
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strategy and transfers the promise and value proposition, which means the intended
identity, towards consumers. The ultimate goal of a company is to gain positive brand
equity, which reflects the value of the brand and can be measured in a financial and/or
customer based way (Kapferer 2004; Keller 2008; Aaker, 2010).

In case the brand identity and the brand image align with each other it can be beneficial
for the company and the brand. Gaining a positive brand image is therefore of high
significance for SMEs in order to position themselves; also with regard to international
markets. Brand equity is developed through effective marketing and generally measures
how a company’s branded product is preferred in comparison to a non-branded
alternative. Nevertheless, it is doubtful if brand equity can be measured for SMEs
(Krake, 2005; Spence & Essoussi, 2010). This issue will be addressed in the literature
review (see section 2.5). A brand’s identity (see definition in section 1.7) is often
expanded through valuable associations that distinguish a brand from its competitors
(Ghodeswar, 2008; Aaker, 2010; Keller 2008). This could be an opportunity to leverage
upon; for SMEs in order to position themselves beneficially in domestic as well as
international markets. Spence and Essoussi (2010) identified that country of origin
(COO) in particular, could be an association that could be used for SMEs to leverage
upon in order to position their brand to gain a beneficial brand image. There are existing
examples of companies that made use of that strategy in the outdoor industry, such as
the brand “Berghaus” (which is actually an English brand but sounds German/Austrian).
If brands want to exploit the opportunity of COO associations towards their brand, this
could be pursued by their actual COO, such as Ikea and Sweden, or by a connection or
association that the company aspires to create; such as the “Berghaus” example shows.
SODBs in this industry could have a benefit in comparison to global competitors and
might hold a unique position in consumers’ minds; due to positive COO associations.
Nevertheless, this possible opportunity has to be leveraged upon by the
entrepreneur/management team in order to exploit it for international markets.

Therefore, managing a brand requires individuals who are creative because, products
are a reflection of the individuals in the firm that creates the product through rigorous
product planning and development process. This makes it vital to have the right people
know who can do what and how they will do it, before and after the recruitment phase.
The relationship between employer and internal branding on the entrepreneurial
orientation at the firm level has often been neglected. This affects the achievement of
corporate goal alignment and employee behaviour, which results in innovation
propensity and attraction of talents in the firm for competitive advantage (Aggerholm,
Andersen, & Thomsen, 2011) through the creation of strong brands. Entrepreneurs can
also be a group of people (entrepreneurial team), this brings the issue of employee
involvement in the innovative and decision making process to light. People talk about
brand management in abstraction but fail to see that there are individuals behind the
creative process. Employee alignment with the organization’s marketing strategy, value,
expectations etc. through internal behavioural branding (Keller, 2008; Srivastava &
Thomas, 2010, Vrontis, Czinkota, & Hadiono, 2012) is crucial because “employer-
branding efforts will be counterproductive if the messages aimed at [employees]
undermine the company’s broader marketing strategy” (Hieronimus, Schafer, &
Schröder, 2005, p. 3). The employees are the ones who deliver the brand promise and if
they do not share the brand values, the effectiveness of internal marketing and the
broader marketing strategy will be short lived.
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