Building relationships with stakeholders in corporate branding

Seminar Paper, 2013

17 Pages, Grade: 2.3


Table of Contents

1. Introduction

2. The value of brands

3. Different types of brands
3.1 Corporate and product brands
3.2 Place brands

4. Brand building
4.1 Building corporate brands
4.2 Building place brands

5. Self- and outside views of brands: adjusting dissonant perceptions

6. Corporate identity and place identity
6.1 Corporate identity
6.2 Place identity

7. A holistic approach for corporate and place brands

8. Relationship-building and stakeholders in branding

9. Conclusion


1. Introduction

“A brand is more than a trademark. It is a trustmark. A brand is a covenant between the company and the consumer. A trusted brand is a genuine asset.” This quote is said to be from US brand consultant Larry Light that expresses two things: First, the intangible asset “brand” is of (great) value and second, the value is defined by the bond the brand creates between the consumer and the company. Both parties – company and customer – profit as the brand creates customer loyalty and facilitates consumers’ choice decision by reducing risk (Dall’Olmo Riley and de Chernatony 2000, p.140/141). A company’s brand value is the advantages a brand provides, such as being able to charge a premium and/or the mentioned customer loyalty. This added value is called brand equity (Aaker 1996, p.68).

We shall understand brands as Kapferer (1997, p.6) describe them: as a promise. “A brand is an impression perceived in a client's mind […]. It is the sum of all tangible and intangible elements, which makes the selection unique. A brand is […] all the attributes that come to the consumer's mind when he or she thinks about the brand”. Although brands and branding are often used as interchangeable concepts, branding – the activity – should in this essay be understood according to Keller’s

(2002, p.151) description: as activities to create a (strong) brand.

In this essay, the author explains the value and types of brands, the process of brand-building – for corporate and place brands –, the link of brands to corporate and place identity and the concept of a holistic brand. All is done with focus on the importance of (building) relationships with stakeholders in branding.

2. The value of brands

According to Kapferer (1997, p.23), before 1980 firms wanted to buy a competitor because of its production capacity, later they wanted to take over a competitor because of the established brand. Thus, after 1980 brands were recognized to be more than logos and names. But why is this so? Isn’t branding a waste of time and money? Coca Cola’s success shows that it is not. Although brand value is quite hard to measure, blind tests of very close substitutes – like Coca Cola and Pepsi – show the value of a brand. Pepsi’s blind test in 1975 showed that consumers, when not knowing if they were drinking Pepsi or Coca Cola, actually preferred the taste of Pepsi. In reality, however, Coca Cola was/is outselling Pepsi. That is why investing in brands, given a successful brand can be built, quite often pays back the invested capital manifold.

Brands provide a multitude of benefits, on the one hand to the customer/user/visitor and on the other to the firm. The benefits to the customer are emotional benefit, facilitation of decision making and lower risk (Moilanen and Rainisto 2009, p.7/8). The benefit to the firm is according to Doyle (1992, p.8) that “successful brands are valuable because they can create a stream of future earnings”.

3. Different types of brands

We will be discussing three different types of brands: Product brands, corporate brands and place brands. Examples for product brands are Whiskas, M&Ms, Skittles, for corporate brands Nestlé or LVMH, the parent company that sells products of brands such as Givenchy, Louis Vuitton, Dom Pérignon and many others. Mars and Nike are examples for both, company and a product brands, but are much better known for the products. Place brands are cities, regions or entire nations, therefore London, Paris, the Normandy, Spain or Vietnam.

Product, corporate and place brands and especially their creations are very different. Complexity increases from the “simplest” product brands to place brands, the most difficult. Complexity in this context refers to building and maintaining the brand as well as possible political and economic variables that might influence the brand. Particularly in the case of the place brand, many brand defining variables have a potentially large influence and are unpredictable. Just think of the outbreak of a war or a large-scale political scandal.

Let’s now look at the different types of brands more closely.

3.1 Corporate and product brands

Product brands have a customer orientation, are (usually) managed by a brand executive within a marketing department, its values are contrived and their life cycles are rather short (Balmer and Gray 2003, p.976-978). Product brands represent an additional value to the customer in comparison to the product alone. They promise an added value (Kotler and Gertner 2002, p.249). While the product is no more than what it actually is – the mere product with its physical attributes –, a brand adds value by the perceptions in the consumer’s head (Hislop 2001, p.6). An Audi is worth more in its buyers’ eyes that an ordinary car, any smartphone is not the same as Apple’s iphone.

Corporate brands, by comparison, have a multi-stakeholder approach, are grounded in (and strongly bound to) the values of the companies’ founders, owners, management and/or personnel (Balmer and Grey 2003, p.976-978). Corporate brands are particularly important to customers, investors and staff (Balmer 2001). “Corporate brands are defined primarily by organizational association”, writes Aaker (2004, p.7). This is because a brand defines what the organization stands for.

Hatch and Schultz (2001, p.1044-1046) write that the most obvious difference between product and corporate brands is that the focus changes from the product to the corporation. But the level of complexity certainly changes, too: Building a corporate brand relies on the efforts of many different departments (communications, marketing, operations, strategy and human resources) as well as top management. It requires organization-wide support. Furthermore, corporate brands have a greater reach compared to product brands, firstly for them having longer-term ambitions (temporal dimension includes past and future, not just present) and secondly for having a higher number of target groups.

3.2 Place brands

There is no generally accepted definition of what a place brand is and what the process of product branding consists of. As Kavaratzis (2008, p.53) states, the easy definition for place branding is that it is just an adaption of product branding to places. But Hankinson (2001, p.129) argues that places are much more complex than products, too complex in fact to be treated like them.

There are several reasons for this claim of higher complexity: First, while the product brand is invented by marketing personnel and the corporate brand can be derived from values, history, vision, the place brand can hardly be designed and implemented, partly because there are too many outside factors that are beyond control such as contemporary and historical associations individuals make with a city or a nation (O’Shaughnessy and O’Shaughnessy 2000, p.56). Second, places require that many quite complex factors are to be considered, such as geography, tourist attractions, natural resources, residents’ characteristics and infrastructure (Dinnie 2004, p.108). Third, place brands have no actual owner as there are too many interest groups with stakes in that brand (from the government to the tourist office and the employers) and the audience is very diverse (Fan 2006, p.7/8). Fourth, governments are not producers; citizens, visitors and the mobile workforce are not like consumers.

An example showing the different levels of complexity: Product brands and corporate brands can easily be damaged by scandals. The former for example if it turns out that the product is of much poorer quality than is claimed by the producer, the latter by occurrences such as bribery, corruption or else. A place brand, say a city’s brand, too, can be damaged by a variety of events. But these occurences are almost always triggered by external causes (think of natural disasters), not by own mistakes.

In the next chapter we will discuss how brands are “built” and which stakeholders are involved.


Excerpt out of 17 pages


Building relationships with stakeholders in corporate branding
University of Leicester  (School of Management)
Elective: Communications & Branding
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ISBN (eBook)
ISBN (Book)
File size
636 KB
Quote paper
Master of Arts UZH Stefan Heini (Author), 2013, Building relationships with stakeholders in corporate branding, Munich, GRIN Verlag,


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