Branding and Innovation

Key strategic partners: University of North Carolina, Tilburg University, The Pennsylvania State University, Erasmus University Rotterdam, University of Michigan, University of Hawaii, Waikato University (New Zealand).

Program coordinator: Prof. Jan-Benedict E.M. Steenkamp (University of North Carolina)

Focal areas: 

  • Key drivers of the success of new products
  • Brand equity and trust
  • Global branding and communication strategies, and how do consumers react?
  • Store brands

Research & Knowledge Sharing Programs on Branding and Innovative Behavior

The introduction of innovative products is one of the most important marketing activities of fast moving consumer goods (FMCG) companies, as well other firms. However, relying on innovation to strengthen the company’s position is a very risky strategy, in that the majority of new product introductions fail to generate significant consumer acceptance. We seek to identify key products, competitive, and consumer factors that affect consumer acceptance of new products in an international setting, and derive managerial recommendations.  Branding plays an important role in the success of new products, and is important in its own right. Strong brands are what distinguishes strong, major players from weaker companies and undifferentiated markets. In this research stream, we focus on several key topics: brand equity, brand trust, business-to-business branding, stretching, brand loyalty and variety seeking, global branding, and brands and emotions.

Critical issues for the continued success of a company are its capability to (1) build strong brands, (2) nurture the strong brands, and (3) leverage its strong brands for optimum market performance and shareholder value.

Our research focuses on several topical and interrelated issues in branding. Brand equity is at the heart of the brand strength. The accurate conceptual definition, actionable measurement and responsiveness to changes are key issues. High equity brands provide several sources of value to consumers and the company. High equity brands can become trusted partners to consumers and customers and provide a source of emotions that extends their customer value well beyond the physical product quality. Brands are the focal points in consumer choice behavior over time, both in terms of consistency in choice (loyalty) and dynamics over time (variety seeking).

Increasingly, companies recognize that brands can best be managed as bigger entities. Strong brands provide a platform for stretching the brand to other categories and to other geographics. This has important implications in terms of the core values that the brand carries and communicates. Increasingly, these values need to extend beyond the single product to bind together a group of diverse products (i.e. more abstract to provide benefit platforms and lifestyle values). Also, increasingly these brands should have a “global image” that appeals to consumers worldwide.

Strong brands are a result of good marketing mix strategy (e.g. product quality, communication, packaging) and we need to understand marketing mix strategies as a source of brand strength development and maintenance. Strong brands, in turn, also provides latitude for marketing mix strategies, in terms of price premium, distribution format and intensity, innovation, and promotional activity.

Store brands or private labels are a particular type of brands, viz., brands owned by the retailer rather than by the manufacturer. This type of brands is becoming ever more important in the Western world. This is due to a set of interrelated factors, including but not limited to increased concentration in retailing which enables retail chains to develop their own brands, improved quality of private labels, higher advertising for private labels, and reduced perceived differences between private labels and national brands. Some consumers have become private label shoppers and have even become loyal to a certain private label, just like other consumers are loyal to a specific national brand. Nevertheless, the success of private labels varies widely between consumers, categories, and countries. Why is this the case?

Within the cluster “branding” we continue to develop and deliver new consumer panel measures, for diagnosing and monitoring brand strength vs. competition, and e.g. vs strength of the outlet. These measures are easy to interpret, and for action ability, supported by marketing literature and a database of 100’s of brands (we will use the UK database for experiments).

Our published and under construction work on Branding & Innovation