Industry image: Its impact on the brand image of potential employees

Christoph Burmann

Abstract

Marketing science has so far devoted very limited attention to the determination of corporate brand images through industry images. Our research, therefore, addresses the question whether industry images determine corporate images and if so, which variables moderate the effect. To accomplish this, a conceptual framework is developed and evaluated in a quantitative, empirical research design. The results demonstrate that corporate brand image is indeed determined by the industry image, and that this determination is moderated by involvement and knowledge about the specific corporation.

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INDUSTRY IMAGE IN THE CONTEXT OF CORPORATE BRANDING

The importance of industry images has recently increased, particularly in capital markets, where its influence is evident. During the boom-time of the new economy, for example, there was an enormous global interest to invest in the emerging internet industry, with hardly anyone taking the trouble to familiarise themselves with the respective companies. Interestingly, the phenomenon of being guided by industry image was not restricted to private investors. Institutional investors also seem to have based their decisions in many cases and to a large extent on industry images. This can serve as an explanation for several effects on the capital market, such as price-earning multiples that are attributed to industry classification or IPOs which are postponed on account of current problems with the industry image.¹

It seems reasonable to assume that the industry image does not only have an impact on the perceptions of potential investors but also on other relevant stakeholders of corporate brand management. Based on this assumption, this paper draws attention to the question whether the industry in which a company operates can have a positive effect on the companies’ attractiveness as an employer. A prerequisite to analyse this question is a thorough understanding of the influence of industry images on corporate brand images. In the current state the literature is lacking empirically proven answers with regard to the nature of this relationship. The aim of this paper is thus two-fold: Firstly, to add to the understanding of the influence of industry images on corporate brand image and secondly, to investigate the impact of industry image on the brand attractiveness for potential employees. Of course, corporate images can also have an effect on industry images. The industry image of a person, who knows a lot about one company in an industry and little about other companies, might be largely driven by the company that is well known. As this influence has less relevance for the management of corporate brands, it is not covered in this paper.

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THE SIGNIFICANCE OF INDUSTRY IMAGE FOR THE DEVELOPMENT OF BRAND IMAGE

One of the fundamental tenets of marketing is that brand images are an important determinant of buying behaviour.^{2, 3 and 4} The construct of brand image can be understood as the associations external target groups have in their minds about brands. These associations can be further divided into those concerning the functional attributes of a brand and those concerning the symbolic attributes of a brand.⁵ Due to the importance of brand images for the behaviour of various target groups, considerable attention has been paid to factors that possibly influence brand images. These influencing factors can be divided into three groups: (1) determinants that originate directly from the internal brand identity and can thus be directly influenced by brand management,^{5, 6} (2) personal/individual determinants, for example, the motives and experiences of those who perceive the brand,^{7, 8 and 9} and (3) external factors, that is determinants that affect the brand image from outside and which cannot be directly influenced by brand management, for example industry image.^{10, 11, 12 and 13}

Up until now little research has been carried out regarding the significance of industry images. Accordingly, first of all a definition of industry image will be drawn up followed by a brief overview of the research carried out so far into the relationship between industry and corporate brand images. Afterwards a conceptual model on the effect of industry image on corporate brand image will be developed by integrating the findings of adjacent research areas. This model will then be empirically tested.

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DEFINITION OF INDUSTRY IMAGES

In Gabler's Dictionary of Economics, industries are defined as groups of commercial institutions engaging in identical or similar commercial activity.^{14, 15} This definition is somewhat hazy. Particularly, the question arises, how identical or similar commercial activities can be determined? Porter¹⁶ defines an industry as a group of companies that supplies products or services that are interchangeable (p. 27). This definition, however, does also appear imprecise since it considers different unspecified degrees of interchangeability. Abell's¹⁷ definition of a industry is more specific. He defines industries on the basis of the addressed customer group, the functions of products and services for customers and the technologies used to access these functions (p. 170ff). This definition highlights the extent to which industry classification is dependent on subjective perception, as it cannot be assumed that everyone will evaluate the used techno-logies, functions and customer groups in the same way. Based on this consideration and the definition provided by Abell,¹⁷ the term ‘industry’ is defined as follows: ‘A group of companies that, from the point of view of one individual, supplies the same customer groups with the same technologies for the fulfilment of the same customer functions.’

On the basis of this definition and the image definition provided by Meffert,^{5, 18, 19 and 20}‘industry image’ is defined as follows: ‘Industry image is a set of associations that is firmly anchored, condensed, and evaluated in the minds of people concerning a group of companies, which, from the point of view of an individual, supplies the same customer groups with the same technologies for the fulfilment of the same customer needs.’

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INDUSTRY IMAGE AS A DETERMINANT OF CORPORATE BRAND IMAGE

Buyer behaviour can relate to different levels of the brand architecture of a company. In particular, it is necessary to distinguish between three levels: (1) corporate brands,^{21, 22} (2) strategic business unit brands²³ and (3) product and service brands.^{24, 25} Especially corporate brands have recently received a lot of attention in both theory and practice.^{22, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39 and 40} On the one hand, this can be attributed to the fact that competition between companies is no longer confined to product markets but has now expanded to include procurement and labour markets as well. On the other hand, the corporate brand is generally of particular importance, as it is often used to support other brands within the portfolio (Meffert and Bierwirth,²⁸ p. 147ff ). We therefore concentrate in the following on corporate brands. A benefit of this reduction is that, taken on a holistic perspective on brand management, no distinction needs to be made between corporate image and brand image, which was defined earlier as associations that external target groups have in their minds about brands.⁵ Consequently, this definition is similar to Balmer's⁴¹ definition of corporate image, which he understands as the perceptions of an organization by individuals or groups.

There is general consensus in both literature on brand management and literature on corporate identity that corporate identity and corporate image, and brand identity and brand image, respectively, have a cause–effect relationship. That means, that an image can best be interpreted as the result of the external perception of an identity, may it be a corporate or a brand identity.^{5, 41} A corporate identity is defined by He and Balmer⁴² as ‘critical attributes and traits that make us distinctive and which defines who we are and what we are as an organisation’ (p. 338). This definition shows apparent similarities to the understanding of the construct of brand identity by Burmann and Meffert,⁵ which they describe as the sum of all attributes that determine the essence and character of a brand from the point of view of the internal target groups (p. 53).

Therefore, in order to understand the relationship between industry image and corporate brand image, one has to start at an earlier stage, namely by looking at the relationship between industry identity and corporate brand identity. The term industry identity, sometimes also called generic identity or branch identity, can be understood as the common identity factors of the organisations operating in a particular industry (He and Balmer,⁴² p. 339). Balmer⁴¹ points out that a strong industry identity fosters similarities with regard to strategic plans and missions among companies belonging to that industry and is thus a determinant of the corporate brand identities, which leads to increased similarity among the respective companies.^{43, 44} Several case studies, especially in the financial sector, support this point of view.^{42, 45, 46 and 47} In an attempt to find an explanation for this phenomenon, Podnar⁴⁸ argues that customers have specific expectations regarding particular industries and the companies belonging to it. As a result of these general expectations companies are forced to develop similar competencies, processes or products and become thus more alike. This argumentation is already reflected in his understanding of the construct of ‘branch identity’ which he defines as ‘those properties or characteristics demanded by customers and other stakeholders which are common to all companies inside a particular branch and which a particular company has to have in order to operate inside the respective branch or industry’ (Podnar,⁴⁸ p. 378). Based on this consideration, he concludes that industry identity shapes the identity of those companies which are operating in it. It is clear that if the industry identity shapes the corporate brand identities of the companies belonging to it, there must be also a close relationship between the industry image and the corporate brand images. One could conclude that the influence of the industry image on the corporate brand images would be just a result of the similarities between industry identity and corporate brand identities. This paper is, however, solely focused on the relationships at the result stage, that is on the stage of industry image and brand image.

Up until now only a few studies have been carried out into the relationship between industry image and corporate brand image. Some authors, for example, Boyle⁴⁹ and Markwick and Fill,³⁶ point to the possible influence of industry image on corporate brand image, but then fail to theoretically work out this idea or to empirically test it. Besides these, there are a number of investigations that empirically determine the image of individual industries, for example that by Marten and Schmöller.⁵⁰ As these only claim that industry image influences corporate brand image without empirically proving it, their importance for this investigation is limited.^{50, 51 and 52}

The most comprehensive conceptualisation of the connection between industry and corporate brand image to our knowledge is that of Dowling,¹³ whose book ‘Creating Corporate Reputations: Identity, Image, and Performance’ is explicitly dedicated to the creation and alteration of corporate brand images. He integrates industry image into a network consisting of country image, corporate brand image and product brand image, and claims that these four images all influence each other. Dowling points out that only a few studies have been carried out into the connection between industry image and corporate brand image; however, his work does also lack an empirical substantiation.

In addition to these studies, investigations on employer brand image and on the capital market also analyse the connection between industry image and corporate brand image. In the area of ‘Employer Branding’, Kirchgeorg, Lorbeer and Grobe established in three consecutive studies on employer image that ‘industry sustainability’ was of medium to high importance for students when it came to choosing a future employer.^{53, 54 and 55} They also determine a high degree of variance with regard to the attractiveness of the examined industries.^{55, 56} Teufer⁵⁷ conceptualises industry image using the two characteristics of environmental behaviour and industry growth prospects. While the environmental behaviour of an industry is of relatively low relevance, the growth prospects of an industry influence the choice of employer considerably and consequently the attractiveness of a corporate brand (Teufer,⁵⁷ p. 186). Fopp⁸ empirically records the images of individual industries in a highly differentiated manner, without, however, linking them with specific employer brands. By doing this he demonstrates the strengths and weaknesses of individual industries and determines potential employees’ wide-ranging intentions when applying to different industries.

Süß⁵⁸ adopts a similar procedure by asking his interviewees to assess individual industry images. In addition, he develops a model for job selection, which is divided into three phases (development of corporate brand images, creation of employer preferences and application to an employer). In each of these phases industry image is of importance (Süß,⁵⁸ p. 74ff ). Süß concludes that industry images seem to hide the bulk of individual corporate circumstances (Süß,⁵⁸ p. 2) and considers industry images to be important determinants of corporate brand image (Süß,⁵⁸ p. 85). His analysis of industry image, however, goes no further than this. Like Fopp he refrains from linking the determined industry images with specific employer brand images.

As an intermediate summary it can be concluded that there is sufficient evidence for the importance of industry image when it comes to the evaluation of potential employers. The studies are, however, for various reasons, incomplete. First, none of the studies examines in a theoretical or empirical manner what influence industry image has on the various attributes of corporate brand image and under which conditions industry image exerts a high or low influence. Secondly, when it comes to the influence of industry image on corporate image, none of the studies are grounded in theory. Thirdly, employer brand image accounts for just a small part of the entire corporate brand image.

In the area of capital market research, Margulies^{59, 60} has already noted how important industry image is for the perception and evaluation of a company by analysts, investors and other financiers. He shows how companies, based on their original fields of activity, are associated with certain industries, and which positive or negative effects this classification can have. His investigations are backed by the works of Stancill,⁶¹ which were published subsequently. He also recognised the importance of corporate brand image on capital markets. Simon et al.¹ note that when evaluating companies, investors pay a great deal of attention to the industry and that this can influence their investment decisions either positively or negatively. According to Simon et al., industry membership results in the creation of limits for the positioning of a company on the capital market. Tomczak and Copperti⁶² in a later publication support the statements of Simon et al. Common to all the capital market investigations is the fact that they represent purely conceptual work based on individual case studies rather than wide, quantitative examinations.

Accordingly, despite numerous studies involving various areas of business administration, there are no sound theoretical and empirical findings concerning the influence of industry image on corporate brand image. This leads to the basic hypothesis underlying this investigation, which is divided into two parts, initially to allow analysis of the fundamental relationship between industry and corporate brand image, and subsequently of the causality of this relationship:

H_1a:

There is a significant relationship between industry image and corporate brand image.

H_1b:

Industry image has a significant causal influence on corporate brand image.

Although scientific literature contains some supporting evidence for the fundamental existence of a connection, no information is available concerning whether industry image influences all the characteristics of a corporate brand image, or whether the perceiving subject has characteristics that strengthen or weaken the connection. In order to clarify this question, other research areas need to be analysed which provide additional findings.

Brand origin research seems to be able to make a contribution to the field, as it also involves the examination of the effect of an image that is superior to the brand image.^{11, 12, 63, 64 and 65} According to Blinda,¹¹ brand origin influences the subjectively perceived functional and symbolic use of a brand. For a brand's functional use this applies in particular when certain skills are associated with brand origin that facilitate fulfilment of brand use. Origin can influence perceived symbolic use by supporting the trust, identification and prestige aspects of brands. Brand origin is of particular relevance for customers who have limited knowledge of the respective product area. Limited knowledge can generally be understood as a lack of sufficient ‘direct’ information concerning the brand, which makes an evaluation impossible. This in turn can be the result of lacking skills or motivation to process the available information.^{66, 67}

Following the application of these findings to the connection between industry image and corporate brand image, it can be concluded that industry image does have a causal influence on the functional and symbolic attributes of corporate brand image. This influence should increase as the knowledge of the respective target of the company decreases, resulting in the following hypotheses:

H_2a:

There is a significant relationship between the functional attributes of industry image and the functional attributes of corporate brand image.

H_2b:

The functional attributes of industry image exert a significant causal influence on the functional attributes of corporate brand image.

H_3a:

There exists a significant relationship between the symbolic attributes of industry image and the symbolic attributes of corporate brand image.

H_3b:

The symbolic attributes of industry image exert a significant causal influence on the symbolic attributes of corporate brand image.

H_4a:

The extent of knowledge about a company negatively influences the strength of the relationship between industry image and corporate brand image.

H_4b:

The extent of knowledge about a company negatively influences the causal influence of industry image on corporate brand image.

Hypotheses H_4a and H_4b show parallels to the elaboration likelihood model of Petty and Cacioppo.⁶⁸ The core suppositions of their model are two different routes of information processing. Central information processing sees all available information gathered and rationally processed before a brand image is created or altered. The quality of the information is considered much more important for this process than contextual factors such as industry image. In the case of peripheral information processing, an individual does not carry out a detailed and rational evaluation of the object (in this case the corporate brand). Instead, he relies on indirect stimuli and heuristics. Such indirect stimuli and heuristics can include the method of information presentation, the source of information or other images that accompany the actual evaluation object, for example the industry image. Since a lack of information also limits the ability to process complex information, Petty and Cacioppo predict a dominance of the peripheral routes. This would in turn imply that industry image exerts a higher influence on corporate brand image. The knowledge of an industry is in this case a moderator of the relationship, as the variable changes the relationship between industry image and corporate brand image. It is not an intermediary variable that is dependent on the industry image and does not explain why an influence exists.

The information processing method chosen by an individual depends on a number of different factors, such as their involvement and problem-solving ability. For the purpose of this paper the controversially discussed construct of involvement is generally defined as the perceived importance of a stimulus to a person (Mittal,⁶⁹ p. 664). A high level of involvement and a correspondingly high problem-solving ability will result in the central route being chosen, while low involvement or low problem-solving ability will result in the peripheral route being chosen.^{68, 70} In addition, two hypotheses on involvement as a moderating factor can be derived from this (cf. Figure 1):

H_5a:

The degree of involvement negatively influences the strength of the relationship between industry image and corporate brand image.

H_5b:

The degree of involvement negatively influences the causal effect of industry image on corporate brand image.

Figure 1.

Illustration of the hypotheses within the frame of reference for the empirical examination
Source: Own illustration
Full figure and legend (70K)

The involvement is also a moderating variable in this case, as it is—as the knowledge of an industry—not dependent on the industry image and does not explain why the influence exists.

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EMPIRICAL STUDY

Study design

For the empirical study of the hypotheses, real corporate brands and industries are used to ensure the greatest possible degree of external validity. Industries and corporate brands are chosen according to the following criteria: (1) manufacturing and service industries, in order to ensure high industry heterogeneity; (2) familiarity of the corporate brands and industries; (3) at least two known corporate brands per industry and (4) companies with clear and unclear industry classifications. Based on these criteria, nine industries and 27 corporate brands were chosen. The industries and corporate brands chosen are shown in Table 1. It additionally shows how the interviewees classified the corporate brands to the different industries (cf. Table 1).⁷¹

Table 1 - Industry classification of the companies included in the study.

Full table

The scholarship holders at e-fellows.net (a programme that sponsors high potential undergraduate and postgraduate students with internet access, access to research facilities and especially targeted events etc) were chosen as an interviewee sample. These scholarship holders include a mixture of undergraduate and postgraduate students from wide-ranging fields of study who, on account of their above-average performance, have been selected by e-fellows.net as worthy of a scholarship. This sample was deemed preferable to one that would be representative of the population as a whole, as the scholarship holders, on account of their high qualifications, possess the largest possible choice of future employers, and are also of particular interest to companies for the exact same reason. A total of 3,368 interviewees completed the questionnaire between January and February of 2005. This corresponds to a response rate of 29 per cent. An internet-based questionnaire was used as a recording instrument, as this represented the best way to reach the interviewees (all scholarship holders receive free internet access as part of their scholarship).

The individual attributes for the operationalisation of the corporate brand images were chosen from the studies of Kirchgeorg and Lorbeer,⁵³ Grobe,⁵⁴ Süß⁵⁸ and Sutherland et al.,⁷² and selected on the basis of their importance therein. In addition, symbolic corporate brand image attributes were added from the study of Aaker⁷³ in order to ensure a sufficient number of symbolic attributes. This selection of corporate brand attributes was chosen, as it includes the widest range of well-tested brand attributes and integrates attributes, that were successfully used in international as well as German studies. This was regarded important due to the set-up of the study which was only in Germany. The attributes were measured on a six-point scale from ‘true’ to ‘not at all true’ and include, for example, ‘co-operation with colleagues’, ‘fun to work’ and ‘training possiblites’.

Industry image, like corporate brand image, is also recorded on the basis of symbolic and functional attributes. In order to ensure the content-related comparability of the attributes of both industry and corporate brand images, the same operationalisation method and the same attributes were chosen as for corporate brand image.⁷⁴ This appears reasonable as Keller⁷⁵ has already noted that industry images can be specified using attributes common to all the companies in an industry as well as those specific to individual companies. He also states that both functional and symbolic attributes should be included in a industry image evaluation.^{58, 75 and 76}

The interviewees also assigned each company to an industry (cf. Table 1). As no sufficiently validated scale for Company knowledge was available for German respondents, Company knowledge was assessed using a six-step Likert scale starting with ‘I know the company very well’ and ending with ‘I know nothing about the company’. This scale was then validated for the purpose of this study by using the individual brand contact points. Each company contact, it was believed, should lead to an increase in the level of knowledge, if the scale was valid. This assumption was empirically confirmed to a significant level in our study.⁷⁷

Involvement was measured by closely following the example of Kapferer and Laurent,⁷⁸ who record it in five different dimensions, all of which are independent of each other. The measurement indicators for the five involvement dimensions were selected from the scales of Kapferer and Laurent and translated into German.⁷⁹ These translations were then checked by experts for comprehensibility. To determine the degree of individual involvement, all of the indicator values were used. As, according to Laurent and Kapferer, all dimensions are equally important, no differentiated weighting of the individual items was carried out.⁷⁸ The five dimensions are: interest, fun, probability of mistakes, sign value of behaviour and importance of mistakes.

This operationalisation treats involvement as a formative construct, with the dimensions representing different facets of the construct.^{78, 79, 80, 81, 82, 83, 84 and 85} Therefore, instead of the traditional criteria like Cronbachs alpha, a MIMIC model was used, which was preceded by a multi-collinearity analysis.^{82, 83 and 86}

The adjustment parameters of the MIMIC model (RMSEA (0,046), GFI (0,995), AGFI (0,968) and CFI (0,960)), were estimated using the ADF procedure^{87, 88} and they achieved very good values, which almost entirely fulfilled the criteria developed by Homburg and Baumgartner.⁸⁹ Only the χ² test failed to provide a satisfactory result (χ^2/df=8,026). This is not a serious problem, as it is not necessary that all the quality measures are fulfilled.⁹⁰

The analysis was carried out in two steps. In a first step, of all the hypotheses marked with ‘a’ were examined using simple regressions and moderated regressions. In order to allow an overall evaluation of the connection for all image attributes, they were first of all z-standardized. For each brand attribute ‘n’ in the newly created data set, an own case in which the respective corporate brand image evaluation was entered into the new variable U_n and the industry image evaluation into the new variable B_n was created. The correlating variables, for example U₁ and B₁, are synchronous, that is the evaluation of the corporate brand image attribute ‘happy’ correlates with the same attribute at industry level.

To examine H_1a, regression was carried out with the entire data set using the variable U_n as a dependent variable and the variable B_n as an independent variable. Individual regressions were subsequently carried out for each corporate brand attribute in order to examine hypotheses H_2a and H_3a. Moderated regressions were carried out for the examination of hypotheses H_4a and H_5a as per Aiken and West.⁹¹ For this purpose, both the moderating variables and the industry image variable were centred and multiplied with each other. The resulting variable is the moderator in the regression equation.

These regressions were used to verify the existence of a connection and not its direction. As a result, another procedure had to be used to examine the ‘b’ causality hypotheses which separated the effect of the corporate brand image on the industry image from the effect of the industry image on the corporate brand image. In order to achieve this, the 13 companies classified as belonging to different industries by the interviewees were selected and the interviewees were then allocated to each study group in accordance with their industry classification. As the interviewees could not be allocated at random to the study groups, as is required by traditional experiments,^{92, 93} it had to be ensured that no distorting self-selecting effects influenced the corporate brand evaluations. Three possible distorting effects (company knowledge, sex and field of study) were examined in order to prove sample equivalence. For the interval-scaled variable, company knowledge, a t-test for average differences was carried out. The two nominally scaled variables, sex and field of study, were examined using χ² tests.

Since sample equivalence could only be ensured for five of the 13 companies selected for this part of the study (N=2,527 corporate brand image evaluations), only these five companies were included in the subsequent empirical examinations. For these five companies, the differences in corporate brand image evaluations in the case of differing industry classifications were analysed.

As a second step, industry images were analysed after having been adjusted for corporate brand image. The reason behind this is to avoid that the industry image is influenced by a particular corporate brand image. This is achieved by only selecting evaluations by interviewees who did not assign the company in question to the evaluated industry. This means, for ex-ample, in the case of AMB Generali and the evaluation of the banking industry, that the only evaluations to be included were those by interviewees who did not assign AMG Generali to the banking industry, and similarly for the insurance industry that the only evaluations to be included were those by interviewees who did not assign AMG Generali to the insurance industry. It is thus assured that the corporate brand image of AMG Generali does neither affect the image of the banking industry nor the one of the insurance industry.

Following this, the differences between the industry image evaluations were calculated for the industry images not distorted by corporate brand image. These values are used in a linear regression to predict the differences between the corporate brand images (depending on industry classification) (cf. Figure 2). The only attributes included in the analysis are those for which the industry images differ significantly.

Figure 2.

Procedure for determining the causal influence of industry image on corporate brand image using the example of AMG Generali
Source: Own illustration
Full figure and legend (105K)

Results of the empirical study

The regression used to examine H_1a showed that 16 per cent of the variance in corporate brand image can be explained by the respective industry image.

This result is highly significant ( p=0.000). Following this, regressions were carried out for each individual corporate brand attribute in order to examine H_2a and H_3a (cf. Table 2). For each regression there is at least an adjusted determination coefficient of 0.07, which represents a weak to medium effect (Cohen,⁹⁴ p. 79f  ). All the regressions are highly significant. The presumed connection can, therefore, be proven for both symbolic and functional image attributes. The differences between the determination coefficients can primarily be explained by the differing discrimination of the industry images. The more the industry image attributes in the sample discriminate, the higher their explanatory contribution to corporate brand image.⁹⁵ The moderated regressions in the case of H_4a and H_5a provide less clear-cut results. Even if the moderator variable is significant, no significant improvement in the explained variance component is achieved compared to the nonmoderated regression, and hence hypotheses H_4a and H_5a cannot be confirmed (cf. Table 3).

Table 2 - Determination coefficients for the individual image attributes (H_2a, H_3a).

Full table

Table 3 - Regression results for the analysis of hypotheses 4a and 5a.

Full table

The analysis of the causal influence of industry image on corporate brand image is illustrated in Table 4. The hypotheses H_1b ( p=0.000), H_2b ( p=0.000) and H_3b ( p=0.001) can be confirmed. The determination coefficients are, at the 0.01 level, highly significant, that is the differences in the industry images make a significant contribution to the explanation of the overall differences in corporate brand images. Comparison of the regression equations for interviewees with low and high involvement shows a highly significant effect. While the regression for interviewees with low involvement is highly significant, and 35 per cent of the variance of the corporate brand image differences are explicable, these values are lower for individuals with high involvement. The regression is not significant (p=0.28) and it explains only 1 per cent of the total variance.

Table 4 - Result of the examination of hypotheses H_1b, H_2b, H_3b, H_4b and H_5b using regression and group comparisons.

Full table

The same applies for corporate knowledge. While the regression for interviewees with low corporate knowledge is highly significant (p=0.000) and 26 per cent of the variance of corporate brand image differences can be explained by industry image, regression with high corporate knowledge is not significant (p=0.44) and explains only 1 per cent of the total variance.

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DISCUSSION OF THE RESULTS

This study proves that industry image has a significant influence on corporate brand image. Both a highly significant connection between corporate brand images and industry images (H_1a) as well as a significant connection for each individually analysed brand image attribute (H_2a, H_3a) could be established. Moreover, the causal influence of industry image on corporate brand image for all industry image attributes could be proven (H_1b, H_2b, H_3b). The moderating effects of involvement and corporate knowledge are only significant for the sub-samples, which were used to examine the causality of the connection between industry image and corporate brand image. These are the samples where the industry images were not distorted by the corporate brand image (see section ‘Study design’). The results for the total sample were in line with the hypotheses, but did not lead to an increase in the determination coefficients, and hence the hypothesis could not be confirmed. There could be a number of reasons for this. For example, it could be the case that corporate knowledge and involvement are only of significance when the industries to which a company can be assigned are significantly different. Implications for further research and management as well as limitation of the study are detailed in the next section.

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PRACTICAL AND THEORETICAL IMPLICATIONS FOR FURTHER RESEARCH AND MANAGEMENT

Despite the confirmation of most of the hypotheses, the study does provide further indicators for future research. These are also the main limitations of this research. For example, the results were all gathered using a sample of students who were asked about their career choice. Still to be examined is the degree to which the results could be confirmed for other target groups of corporate brands (eg investors and employees). Furthermore, the results were gathered using only a limited selection of companies and industries. This applies, in particular, to the causal influence of the industry image on the corporate brand image as for the evaluation of this hypothesis out of the total group of 27 corporate brands, only five could be evaluated as only for those sample equivalence could be proven.

Next to that, it remains open to what extent industry image also affects the images of a company's other brands (eg product brands, strategic business unit brands), and what kind of influence this represents. What degree of freedom remains for the management of a corporate brand, if a large percentage of the variance of the individual attributes of corporate brand images are determined by the industry image? The opportunities for brand management activities, it would seem, are much more limited than is often assumed.

Therefore, the relatively strong influence of industry image on corporate image has wide-ranging implications for companies. These implications depend, on the one hand, on whether the industry image has a positive or negative influence and, on the other hand, on the importance of the brand attributes that are influenced by the industry image. A positive industry image influence on important attributes of the corporate brand image can help a company to differentiate itself from competitors or from other industries. A negative industry image, on the other hand, in particular, if it involves important corporate brand attributes, can lead to competitive disadvantages. In such a case the negative influence can be reduced by altering the image of the industry itself. This can be done by initiating and contributing to voluntary industry self-commitments or through strengthening the public relations work carried out by industry associations. Concrete results in this case, however, are only to be expected in the long term and only if consistent industrywide measures are implemented.

Furthermore, a company can alter its actual membership of an industry or the subjective perception of its membership of an industry. For example, the alteration of its strategic business unit portfolio can influence the industry to which it belongs. Likewise, the perception of industry membership alone can be altered in the long term by deliberately managing the brand architecture, clever co-branding or emphasising individual industries within the framework of corporate communications.

What significance does this study, therefore, have for the questions asked at the beginning of the article? As far as employer desirability is concerned, a number of straightforward conclusions can be drawn on the basis of this study, as the influence of industry image was determined using the example of employer selection. It was shown that employer desirability very much depends on being in the right industries. This applies, in particular, if applicants have little knowledge of the company or low involvement with respect to employer selection.

With regard to brand management practice and to the findings of He and Balmer,⁴² this study provides a strong argument for industry collaboration. It is undoubtedly a mutual task to positively influence the industry image. This is of particular relevance for industries and companies that are under public scrutiny and suffer from weak images such as the oil industry or, in many economies, also the banking industry. Drawing on the argumentation of Podnar,⁴⁸ a useful first step for a single company could be to analyse the necessary points of parity with the other companies in the industry and, in many cases perhaps more important, to identify relevant points of difference. This process should result in a clear and differentiating positioning.

From a practitioner's perspective, it would be particularly interesting to learn more about possibilities to either make corporate brand images more independent of industry image or to influence the industry image by changing the corporate brand image of one prominent player in the industry. It seems reasonable to assume that certain industries are heavily influenced by the image of just a few companies. Microsoft and Apple are surely examples of corporate brands that shape the industry image strongly. The question arises as to what extent the causal relationship analysed in this paper works the opposite direction as well. Moreover, it would be interesting to investigate how strong and differentiated a brand image has to be in order to reduce the effect of the industry image to a minimum. Future research should seek for insights into these areas.

The concept of participatory market orientation: An organisation-wide approach to enhancing brand equity

Nicholas Ind¹ and Rune Bjerke²

Correspondence: Nicholas Ind, Equilibrium Consulting Box 5822 Majorstuen Oslo 0308, Norway. E-mail: nind@equilibriumconsulting.com

¹is a partner in Equilibrium Consulting. He is the author of a number of articles and papers and eight books including The Corporate Image. The Corporate Brand, Living the Brand and Branding Goverance (with Rune Bjerke). He is also the editor of Beyond Branding.

²is an Associate Professor at Oslo School of Management. Previously, he taught at BI Norwegian School of Management. He holds a PhD from the University of Otago in New Zealand. He is the co-author of Branding Governance.

Received 22 August 2007; Revised 22 August 2007; Published online 9 October 2007.

Abstract

While much marketing literature sees delivering customer experience as the role of the marketer, we argue that this is an organisation-wide responsibility. The organisation-wide approach is based on the premise that the brand-building capability of the organisation is determined by the combination of marketing, human resources, organisational culture, leadership and evaluation. It is our contention that the role of marketing should be concerned with connecting these elements to optimise brand equity (eg awareness, perceived quality, associations, loyalty). In this paper, we suggest a participative model for an organisation-wide approach where the role of the marketer is Janus-like in that he/she must face both outwards to connect with customers and other stakeholders and inwards to build coalitions inside the organisation to deliver a clear and consistent customer experience.

Keywords:

participation, marked orientation, brand elements, brand equity

INTRODUCTION

Much traditional marketing literature has a product and marketing communications-led approach to the idea of creating customer experience. Yet in most Western economies, it is services that predominate and consequently it is the other elements of customer–organisation interaction that are dominant in the formation of brand image.¹ It is employees and their ability to build relationships with customers that determine value.² The outside-in, inside-out approach to brand building suggests the importance of aligning employees with the brand and in uncovering the meaning of the brand through participation.³ This shows the value of customer-facing employees in particular, but it is the collective effort of the organisation that is important, for as Chenet et al.⁴ suggest service delivery is a combination of culture, leadership, commitment, systems, tools and technology. It also indicates the value of entrainment⁵—where the organisation is focused on enhancing customer experience not via abstracted thinking, but through a union of interest based on a dynamic relationship.⁶ This thinking extends the role of marketing by suggesting that its role should be not only to sense movement in the environment but also to shape the organisational response by connecting with other business functions and departments. One of the strands within marketing thinking that has tried to deal with the problem of marketing's overtly external emphasis is the concept of 'market orientation'.

MARKET ORIENTATION

The idea of market orientation is that organisations should focus on the interaction with customers and then look inward to explore how that customer knowledge can be used to build organisation-wide responses. Kohli and Jaworski⁷ saw the concept as referring to 'the organisation-wide generation of market intelligence, dissemination of the intelligence across departments, and organisation-wide responsiveness to it'. Narver and Slater⁸ featured some similar elements, seeing market orientation as (1) customer orientation; (2) competitor orientation, and (3) interfunctional coordination. Narver and Slater's emphasis is, however, on market orientation as organisational culture, which they argue drives behaviour. This means that market orientation can only exist if there is a culture that is oriented towards customers. We should, however, remember that while culture drives behaviour, behaviour also drives culture.⁹ If we see culture as static we might come to the view that in a noncustomer-oriented culture, people cannot consistently be market oriented. Yet we would argue that culture is dynamic. Leaders cannot simply tell people to be more customer oriented and expect a transformation to occur, but they can lead by example and committed groups of individuals can change the organisational way of doing things by focusing on the delivery of customer value. This can lead to cultural change and enhanced market orientation. Jaworski and Kohli¹⁰ endorse the importance of leadership in their analysis of the antecedents of market orientation because of leaders' ability to stimulate an external focus 'through continual reminders to employees that it is critical for them to be sensitive and responsive to market developments'.

Gainer and Padanyi¹¹ argue that researchers see market orientation as a cultural construct or a behavioural construct (separate or connected/correlated), or even a hybrid incorporating both cultural and behavioural aspects. Their study of nonprofit organisations showed that a positive relationship between market-oriented behaviours and organisational performance is mediated by market orientation. Further, Kee-hung and Cheng¹² used data from 304 organisations, which had operational quality management systems, to investigate the relationship between quality orientation, market orientation and organisational perforeance. The study (based on both qualitative and quantitative data) revealed that quality orientation and market orientation are complementary and they authenticate the view that quality management and marketing reinforce each other in strengthening organisational performance. Lastly, Matsunoa et al.¹³ compare three different scales (the scales of Kohli and Jaworski, Narver and Slater and EMO¹⁴—extended market orientation). Their conclusion: the Narver and Slater scale was found to be superior to the others in terms of predictive validity, but based on scale reliability, limited unidimensionality and construct domain no single scale examined here was found satisfactory.

APPLYING MARKET-ORIENTED THINKING

Market orientation stresses the importance of connecting the organisation together to deliver value to customers. It seeks to overcome the problem of siloisation that is prevalent in organisations and supports the concept of an organisation-wide approach. Researchers may debate whether it is a cultural or a behavioural construct, but our view is that these two ideas are interlinked. We see market orientation as a way of facing the world—in that sense it is a cultural construct. Culture is, however, about the way of doing things. It determines and is determined by behaviours. Yet, the real challenge is that organisations struggle with market orientation. Partly this is to do with the difficulty of changing culture in a managed way and partly to do with the problem of organisational fragmentation. Yet there seem to be other factors at work. Jaworski and Kohli's 1993 paper addressed three specific questions: (1) Why are some organisations more market oriented than others? (2) What effect does a market orientation have on employees and business performance? (3) Does the linkage between a market orientation and business performance depend on the environmental context? Based on two national samples the researchers argue that market orientation is related to top management emphasis, the risk aversion of top managers, interdepartmental conflict and connectedness, centralisation and reward system orientation. Moreover, a market orientation is related to overall business performance (but not market share), employees' organisational commitment and esprit de corps. And even more important, the connection between market orientation and performance appears to be consistent across environmental contexts that suffer from varying degrees of market turbulence, competitive intensity and technological change. We might conclude from this that there are no environmental reasons to prevent market orientation and plenty of benefits. This is supported by other research:

• Slater and Narver¹⁵ showed that the benefits of a market orientation are long term even though environmental conditions are often transient. Becoming market oriented is costeffective in the long term in spite of any possible short-term moderating effects of the environment. 'A market orientation is a particular form of business culture', and 'becoming and remaining market oriented are essential to the continuous creation of superior value' (Slater and Narver¹⁵, p. 53).
• Siguaw, Simpson and Baker¹⁶ discovered that a supplier's market-oriented behaviour directly or indirectly affects all the channel relationships examined from the distributor's perspective. In particular, the distributor's market orientation, trust, cooperative norms, commitment and satisfaction have an impact on financial performance.
• Hampton and Hampton¹⁷ found that professionalism and rewards were positively correlated with market orientation. Further, the study revealed market orientation was strongly and eositively related to job satisfaction.

In our judgment, market orientation suffers from three limitations: (1) Researchers, while connecting market orientation to business performance, have not explicitly linked it to brand-building capability. (2) The measurement systems, as observed, have not been sufficiently deep. (3) Insufficient attention has been paid to the reality of how to engage the organisation to become market orientated. In particular, the whole area of implementation has been underplayed. A market-oriented culture is not only about inter-functional coordination (Slater and Narver 1994), dissemination (Kohli and Jaworski 1990) or the type of organisational antecedents (factors) that enhance or impede the implementation of the business philosophy. Rather market orientation is a consequence (although it in turn reinforces) of a supportive organisational culture, HR drivers and leadership. To develop this line of thinking, we have developed the concept of participatory market orientation: a fusion of internal¹⁸ and external market orientations with an emphasis on realising the potential of market orientation.

PARTICIPATORY MARKET ORIENTATION

Here we suggest a development of market orientation: participatory market orientation (PMO). A participatory market-oriented philosophy aims to build brand capability and brand equity by involving employees, customers and other stakeholders in the development of the brand. This suggests that the role of marketing as an organisational driving force is to help the organisation become participatory, such that all investments in external and internal marketing activities should encourage participation and strengthen the brand.

This indicates that PMO is an orientation that adheres to the idea of entrainment. This belief in the value of participation steers the way in which investments are made in both internal and marketing activities and recognises their connectivity. It suggests as a principle that, rather than an over-reliance on traditional marketing communications to build a brand, funds are allocated to become entrained with customers and to integrate a relevant organisational response encompassing communications and actions. This goes beyond the ideas of brand community¹⁹ to demonstrate how organisations can build networks of genuine interest with customers. An example of this participatory process at work are the Grathak Katha (consumer's voice) events held by the Bangladeshi mobile operator GrameenPhone. GrameenPhone is the leading mobile telecom company in Bangladesh with a 62 per cent share of the market and 8.5m customers (September 2006). This is a high growth market, but it is also extremely poor: the average GDP per head is $421 (US) and GrameenPhone's business model is designed to work with customers whose average spend on mobile telephony is $2 per month. To better understand its customers and develop innovative ways of selling its services, the company conducts regular market research studies and particularly the delivery of customer service. In addition to this research, GrameenPhone has initiated a process for removing the distance between the company and its customers. This participative approach involves regular meetings with customers in an environment that is both social and businesslike. The idea is to obtain direct interaction with customers both as a way of enhancing the reputation of the brand and as a means of learning about and learning with customers. At the events, GrameenPhone matches the attendees one to one with employees so that there is the opportunity for personal dialogue. On these occasions, research is conducted and results are presented, new products are discussed and customers provide ideas on new opportunities. The idea is to mix the formal and the informal and such has been the momentum behind the process that music performances at the events are by groupe that combine employees and customers playing together. GrameenPhone has discovered that the quality of the feedback is high and the comments are genuine. Customers are not concerned with trying to either attack or please GrameenPhone, they just try to offer input and to relate their experiences. In one year the company conducted more than 300 events with over 200,000 participants. The key to maintaining the interest in the process both within GrameenPhone and externally with customers is the rapid processing of information, the actions taken as a result of input and the feedback provided. Marketing Director Rubaba Dowla Matin argues that the success is due to the organisational capability to validate, categorise and analyse the data and to involve the relevant teams in the organisation. It is these cross-functional customer management teams that play the vital role in determining the nature of the insight and in generating action and communication. This investment into deep and direct insight and the willingness to encourage organisation-wide participation have been the catalysts behind the success of the initiative and the company's burgeoning reputation as an innovator.

Another example is sportswear company Quiksilver,²⁰ which achieves entrainment through several key mechanisms. It recruits people directly from the sports it serves (skateboarding, snowboarding, surfing), such that most people at Quiksilver, from the CEO and the key directors down, are board riders and employees are encouraged to take an active part in their sports. This helps to ensure that managers and employees are taking an active part in an ongoing dialogue with customers. Quiksilver employees do not have to resort to abstracted data to make informed decisions, they can work from current and direct experience. This is, however, not just one way. Quiksilver encourages interested people to contribute their ideas. The several hundred professional riders and an army of supported amateurs are an extension of the grassroots connection Quiksilver enjoyed in its early days when it was run as a hobbyist surf shorts business. Quiksilver knows that creativity has to meet with the approval of the enthusiast audience both to ensure it is a trend leader and to maintain its authenticity. Some innnovations are the direct result of input from riders, such as the development of surfing fiction books aimed at girls, and some ideas are the result of dialogue that provides inspiration for designers. Rapid feedback also tells the company when its products are not working as they should or its communications are not connecting. The important element of collaboration is the ability to listen. Quiksilver achieves this largely by treating the riders as insiders. The language of the company reflects this: riders are part of the organisational structure. They are welcomed at Quiksilver offices and they meet with employees at sporting events.

Within Quiksilver itself, the internal borders are played down and the importance of collaboration is emphasised. Groups are formed from across departments to explore ideas in largely informal, intuitive ways. The brand provides a template against which decisions are made, but there is also a strong belief in being open-minded so that good ideas—whether they come from inside or outside—are not missed. Quiksilver's entrainment with its customers enables it to develop new ranges and communications without recourse to research.

The key requirements for entrainment are a sufficient degree of interest (from both employees and customers) and a receptivity to ideas from different sources both inside and outside the company. For example, many of Apple's heralded innovations (iPod, iTunes, multi-touch) have been adaptions and development of technologies generated from outside the organisation. Similarly Lego's development of its second-generation Mindstorms range was due to the unanticipated input of AFOL (Adult Fans of Lego) users, which initialey the organisation ignored and then, having realised its potential, co-opted into product design. Also, online organisations such as Amazon, e-Bay and Wikipedia, and the whole Open Source Movement thrive on an intensive sense of engagement, because they enable people to achieve a Maslowian sense of self-realisation and the plaudits of their peers. These online brand builders have largely eschewed traditional forms of marketing communication. Instead their power has grown through a transparent approach, the encouragement of sharing and word-of-mouth engagement.^{21, 22} Our judgment is that in future, the only real control will be in having an authentic, participative brand. That means bringing the customer inside the organisation and aligning the whole organisation to create relevant value. In software development, the writer Eric Raymond calls this the Bazaar model and contrasts it with the Cathedral model where the source code is a carefully guarded secret.²³ In the essay 'The Cathedral and the Bazaar', Raymond suggests that the Bazaar model is a more effective way of testing software code than the Cathedral model, which has to guess customer reactions. In reviewing the Bazaar and Cathedral model, Andreas Mack writes: 'Looking at brands we discover cathedrals all around us. Polished up brands launching into stardom or disappearing into failure. Brands secretly pre-tested and pumped up with meaning, structure and visuals, creating identities to last a lifetime... A bazaar approach to branding lets consumers, retailers, press and public take a peek behind the scenes and have a say when decisions are made...Smart brands will welcome the consumer's role as a natural partner in a collective process of product and brand development'.²⁴

Marketing's role then shifts subtlety with a PMO. Marketing becomes concerned with helping to create an organisation-wide commitment to customers and a supportive culture, style of leadership, governance and human resources policies. Partly marketing must have an internal market orientation to achieve this organisation-wide perspective and partly it must be a key element in building bonds with customers and sharing knowledge about them inside the organisation: externally sense-making and internally sense-sharing. This internal/external approach builds the brand. The value of this twin perspective is endorsed by a study of Sweden's 500 largest companies²⁵ that shows organisations with the highest brand orientation index (BOI), where branding is the hub of operations are characterised by an ability to combine both an internal and external focus. Interestingly, the profile of high brand orientation companies is found in roughly the same frequency among business-to-business and business-to-consumer companies (50/50) and goods to services (57/43). This study reinforces the link between brand orientation and profitability suggested in the PMO value chain, by demonstrating the correlation between the two with the group of leaders in terms of orientation showing operating profits almost double the lowest brand orientation group: 'the most important outcome of this study is that we have been able to establish a clear link between brand orientation and profitability: the more brand-oriented a company is, the more profitable it is'.

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PMO AND BRAND EQUITY

In recognising the importance of human capital and internal market orientation, it must be remembered that the value of this is in building brand equity and delivering customer experience. Brand equity and the brand elements constituting a brand are much discussed in marketing literature. Kapferer's²⁶ brand identity model proposes brand components or dimensions (brand elements) such as physiqee (a product's objective and tangible basis), personality (the character), culture (set of values feeding the brand's inspiration), relationship (love and friend), reflection ('the customer should be reflected as she/he wishes to be seen as a result of using the brand') and self-image (one's own internal mirror stimulating an inner relationship with ourselves). Aaker and Joachimsthaler²⁷ distinguish between product elements (scope, attributes, uses, quality/value, functional benefits) and brand elements (brand personality, symbols, brand/customer relationship, self–expressive benefits, emotional benefits, user imagery, country of origin and organisational associations). De Chernatony and Dall'Olmo Riley²⁸ suggest a tangible – intangible spectrum ranging from concrete, physical characteristics (tangible) to those of a more abstract/immaterial (intangible) nature. Keller²⁹ argues that the intangible elements do not constitute brand elements as he believes a brand element is 'trademarkable' visual or verbal information that identifies and differentiates a product or service — the most common ones being names, logos, symbols, characters, slogans and packaging. Most viewpoints on brand equity have an external orientation to the building of the brand and imply that the way to increase brand equity is through investments in marketing efforts. In contrast, de Chernatony and McDonald³⁰ see equity as broader by including organisational dimensions as input variables in increasing brand equity. This underlines the importance of the brand's vision, mission, organisational culture and values.³¹ It suggests that most of the value creation of the brand equity takes place within the framework of the organisation and that customers' confidence in the brand determines the financial value of the brand.

The essential role of brand elements is to contribute to the formation of consumer confidence. But brand elements by themselves do not create the condition of confidence. Confidence and trust comes into being through experience,³² which again suggests the vital role played in the delivery of customer experience by brand aligned employees. For this reason, we differentiate between brand elements and the organisational elements that deliver the product and service. Vision, mission, values and cultural heritage are not brand elements but are rather driving forces that guide the strategic direction of the brand to enhance brand experience and thus brand equity.

BECOMING PARTICIPATORY

Achieving a balance³³ between the internal and external requires a PMO. This is something that the organisational culture has to encourage and that leadership must demonstrate by its communications and actions – something the BOI study endorses with its discovery that in the most brand-oriented companies, the executive management group is very active in brand-related activity. Market orientation suggests as its first principle that there is an organisation-wide responsibility to gather market intelligence. Partly this is about the ability to gather and use market research effectively, but it is also about the principle of entrainment: of getting genuinely close to customers, so that the acquisition of knowledge is direct and unmediated. This is what Quiksilver does through its free-flow connectivity and GrameenPhone achieves with their Grathak Katha. These are markets of exchange, where organisations seek to listen to and connect with customers. The challenge here is not to organise the mechanisms of exchange but to approach the customer with an open mind and a willingness to accept ambiguity and uncertainty: 'any creative thenker who ventures into new territory risks chaos and fragmentation'.³⁴

If the organisation has permeable boundaries, so that it can easily absorb knowledge, the next stage in PMO is the ability to connect people internally in developing a response. This requires a sense of organisational unity and a conducive communication climate. Referring to how organisations communicate internally, Van Riel³⁵ writes that communications research 'stresses the importance of "soft" aspects in communication like openness, honesty and participation in decision-making, resulting in the necessity for managers to pay serious attention to communication climate, specifically their own role in improving the climate'. Making the climate effective will always be easier to achieve if there is a strong sense of unity built around the identification with and internalisation of the organisational vision and values and a connectivity with customers. If people have a common aim and a shared sense of accountability, it is easier to react to events.³⁶ This is not to suggest that individuals simply operate on automatic based on the vision and values—rather it suggests that the implications of the vision and values are understood and help in decision-making both as a point of inspiration and as a guide to behaviour. In fact, the forward momentum in the process of discussion and debate needs to be contained within the vision and values themselves as this encourages the discovery of meaning through discourse. The vision and values should stimulate debate; the organisation needs the 'dirt' that fuels creativity.³⁷

This importance of a shared vision and values might suggest the denial of diversity. Yet we argue in favour of diversity and adaptability provided there is a common understanding of the vision and values.³⁸ There needs to be an organisational acceptance of tension, a willingness to avoid too much control and an embracing of diversity that creates the opportunity for innovation within the framework set by the vision and values: 'we are starting to think of heterogeneity as something valuable, not as an obstacle to unification'.³⁹ When there is a lack of connection with the vision and values or an attempt to force homogeneity, siloisation is more likely as people turn inwards to their own business unit agendas and away from the organisational whole. This fragmentation prevents the sharing of knowledge and inhibits the development of a unified approach to events.

Although homogeneity may appear desirable it creates contradictions. If the organisation tries to prescribe employee behaviour in line with the vision and values, it is reducing the opportunity to discover the meaning of those same vision and values. It is trying to make something that is inherently dynamic, static and unchanging. It is far more productive to allow the meaning of the vision and values to develop in response to events. This suggests that alongside the planned organisational systems, there has to be sufficient allowance for adaptation as the culture, identity and image of the organisation change. The element that separates the participatory approach is the idea of personal and direct engagement by managers and employees, who understand and are able to explore the framework of the brand. It suggests an ongoing dialogue with customers and with colleagues and relationships built on trust and openness.

CONCLUSION

PMO builds on the role of a free market in which most participants wish to optimise the process of exchange. In other words, parties involved in exchanges want to be as efficient and effective as possible: the organisation wants to acquire insight and deliver relevant products and services and extereal audiences want to acquire resources and the accompanying rights of ownership or usage. In a market-oriented organisation, the exchange is hindered potentially by several factors: (a) the ability to collect meaningful and usable insights;⁴⁰ (b) the ability to share knowledge within the organisation;⁴¹ (c) the ability to unify organisational actions to deliver resources. These challenges are not the result of a flawed concept, but more the lack of attention given to the operationalisation of the concept. This has been the motivation behind the development of the concept of PMO. This concept suggests a unity based on a closeness between employees and customers and between employees. It is only when employees are entrained with customers that they are able to acquire deep insight into behaviour and it is only when employees and managers are able and willing to work across organisational boundaries that value can be delivered consistently to the customer. This indicates the importance of such aspects as organisation culture and leadership. It is only when the organisation is able to communicate effectively across boundaries that closeness can be achieved. This relates to Ling's idea of internal market orientation and the importance of fusing the organisation together. One important element in this is bringing marketing and human resources closer. This ought to be something that is considered in the planning of management education and also in the structuring of organisations.⁴²

The whole process of market orientation can be more or less participatory. The lower the involvement of customers in the process, the more likely it is that the organisation will be seller centric.⁴³ The lower the involvement of employees, the more likely it is that the organisation will not meet customer expectations. Therefore, the aim should be for high levels of participation to become entrained with customers. This suggests that many people in the organisation should be involved with the marketing process and consequently with brand building. As an area of functionality, people in marketing should be responsible for and focus on the relationship with the customer: researching attitudes and behaviour, sharing knowledge internally, developing and executing marketing communication plans internally and externally and stimulating collective thinking and actions. Within this range of functions, we would stress the need for genuine insight into customers, the need to share knowledge internally, and most importantly, the ability to galvanise the organisation into action to deliver the brand as a seamless experience.

We the people: The importance of employees in the process of building customer experience

Patrick Harris¹

This paper considers the importance of employees in the process of building customer experience. The paper states that internal investment is rewarded with consistent, quality customer exchanges. Emphasis is first placed on the positioning of brand management within an organisation, and its linkage to strategy. Secondly, the tools of identity and guiding principles are introduced. These tools are used to activate staff by inviting their engagement and by asking them to review the brand from a personal perspective. Identity encourages employees to interpret corporate identity and apply it to their unique situation and skill set. Guiding principles serve as a platform to nurture desired behaviours in the organisation. Together, these two tools better prepare staff to respond to customers. Brand values are presented as the currency to measure the worth of exchanges between organisations and their customers. The paper concludes by presenting a case study of the mobile operator, Orange, during the period 1994–2003.

INTRODUCTION

Branding is about people. People build brands. People buy brands. The relationship, at first glance, is a simple one—build a good brand and others will buy it. At the heart of this relationship, however, is another group of people, that of the employees. It is the employees who enact the attributes of the brand and whose actions ultimately foster customer experience—whether good or bad. Staff actions should reinforce the promises a brand makes to its customers. If wisely conducted, this reinforcement breeds more success in terms of sales, awareness and loyalty. Employees have the formidable task of demonstrating the brand by the actions they take. The adage actions speak louder than words is a truth that holds firm in the process of building successful brands.

Many organisations, however, fall short of representing the brands they espouse. Sometimes, this disconnection is due to uncommon circumstances. These include sudden market shifts that are external to the organisation. Internal changes—like the loss of a key figurehead or an organisational merger—are also examples where a disconnection, between the brand attributes and employee actions, can be present. These examples, and others like them, provide resilience tests for brands. The question is, can effective internal brand management help to overcome these difficult periods? Further, can an ongoing internal brand management process help to preserve a healthy relationship between employee actions and customer experiences?

This paper discusses the importance of inward-facing brand management. Emphasis is given to the positioning of brand management and its relationship with organisational strategy. Separately, the tools of Identity and Guiding Principles are presented as a means of serving the employee effort to enact the brand attributes. Finally, a case study involving the mobile telephone company, Orange, is introduced for illustrative review.

AN INWARD PERSPECTIVE

It was in his seminal paper of 1937 that Ronald Coase prescribed the basic reasoning of a firm.¹ He described the importance of building and maintaining relationships as the very essence of a firm 'A firm, therefore, consists of the system of relationships which comes into existence when the direction of resources is dependent on an entrepreneur.'

If consistency of brand experience is sought, this definition suggests the need for a balanced focus of nurturing and serving internal and external relationships. Yet, in many brand management efforts, resources are usually dedicated to constructing an outward image of the brand. Advertising, packaging and sponsorship are traditional examples. It is commonly accepted that internal characteristics are transferred to the external environment via the employees of the organisation. Further, this transferral may be unintended if left unchecked. This point implies a need to manage, or at least positively influence, the identity that is transferred outwardly—in order to maintain consistency and overall control. Thus, the internal workings of a firm should form an integral part of brand management. Brands today must represent a company's history, future vision and its outward appearance—as well as the internal representation of the organisation. Why, then, do organisations give little attention to internal brand management?

The right level

Inward-facing brand management must be considered at the appropriate level if it is to succeed. Brand management, when considered as a periphery exercise of a marketing subset is destined to perform poorly. Brand today is a key element of every transaction the organisation engages in and as such should be strategically incorporated into internal activities. Brands do far more than label products or companies. Brands today can

• change market dynamics;
• span across entire markets and enter new markets and
• heavily influence industry business models.

Google, Amazon and Napster are examples of brands that have significantly changed the dynamics of entire markets. Virgin, Marlboro and Caterpillar are good illustrations of brands that can span industries or enter new industries. Finally, MySpace and Blackberry are brands of influence that have stimulated enormous changes to business models in their respective markets.

Despite this shift in the influence of brands, intelligent dialogue between brand managers and the strategic elements of the firm is often lacking. In reality, management of the brand must feature in all that the company undertakes, internally and externally. Brand must be prevalent in strategy, training, objective-setting, working style, facilities and much more. Ind (2004), when discussing the concept of living the brand, argues that brands come to life when internal and external boundaries are blurred.² Most importantly, brand management must also be well integrated into the activities of the organisation if it is to deliver quality customer experiences.

But the phrase living the brand does not necessarily express the integration of brand at a strategic level of the organisation. Organisations that unite strategy and brand possess cohesive workforces that demonstrate sound direction, incorporate a recognisable approach and present a high-quality, consistent customer experience. Ind's phrase can be extended for organisations that provide a strategic and integrated focus of brand management—being the strategy and living the brand.

What they do, not what they say

Internal branding should concentrate more on context rather than content. It should focus on why an activity occurs more than the brand compliance of the activity itself.

A hypothetical example of branding the company canteen is helpful as an illustration. In this circumstance, it is not the branded colour of the crockery or the ability to reinforce company messages on the walls that is critical. Rather, emphasis should be on the behaviours exhibited when serving or receiving food, and on the atmosphere that is conveyed by staff. Behaviours are visible evidence of the brand's capacity to influence. Too often, it is the focus on tangible items that receive the bulk of the attention—ensuring that the content meets stringent brand guidelines—while overlooking the contextual settings and behaviours of the people involved.

The relationship between employees and customers is—or at least should be—genuine, two-way and sincere. What is displayed externally is chiefly a reflection of the activities of the internal organisation. For this reason, inward brand management should not be limited to providing training material for customer-facing staff only. Instead, it should be the creed by which the whole organisation elects to live and breathe. Internal activities should always underpin the customer experience sought. Thus, brand management efforts must be focused inside the organisation as much as, and possibly more than, they are externally. The key is to provide staff with appropriate tools, allowing them to be the strategy and live the brand.

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IDENTITY: BUILDING UNDERSTANDING

Corporate identity, the persona of an organisation, is widely used by companies and agencies alike. It is normally expressed in a hierarchical set of descriptive terms—from say, vision to values—and provides guidelines for how the organisation expresses itself. Corporate identity is a valuable asset of any brand manager's toolkit.

Corporate identity is not necessarily the best tool for employees, however. A workforce is, after all, a collection of people and often, a corporate identity does not adequately speak to each as an individual. Further, individuals see organisational change and shifts in corporate identity as uncomfortable and difficult to accept. Employees take these shifts personally and feel lost when another directive arrives, with a new focus, and the CEO asks for their buy-in—once again.

Activate, not automate

Inside organisations, it is not buy-in that is necessary, but momentum. Buy-in is a flawed concept that suggests 100 per cent effectiveness in the communication of an idea, 100 per cent belief en it by the listener and 100 per cent efficiency in enacting it. Momentum, however, is created by communicating the gist of an idea and afterwards, encouraging individuals to interpret it, apply it to their unique situation and then use their individual skills to address it. Momentum taps into the collective wisdom of the staff and invites their participation. Here identity is still in use, but it is not an induced corporate identity communicated from the upper echelons of the company. Instead, individual identity is developed by regularly encouraging employees to interact with the company position. This allows them to reach a greater appreciation of its meaning to them personally, or as smaller teams of people. This is how it should be. Identity, used as a tool, allows individuals to increase their overall understanding of the organisation and to personally ingest its meaning. Workshops, training programmes and promotion of good dialogue are good methods to achieve this aim.

There are several benefits of the process of engendering identity. Firstly, employees have a stronger personal sense of organisational purpose. They know what to do and why they should do it. Secondly, they are less affected by significant organisational changes that (inevitably) will occur. They take these changes less personally. Thirdly, they are better equipped to see how their role can make a difference to the company as a whole. Fourthly, a company-wide spirit of involvement and responsibility is in action. Overall, their understanding is more consistent through change and this consistency features readily in their work. They can, in effect, be the strategy.

The next step is to help staff to underpin their understanding with appropriate behaviours.

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GUIDING PRINCIPLES: NURTURING DESIRED BEHAVIOUR

Consistent behaviour cannot be prescribed, nor can cultures be assigned. Cultures are more amorphous than this. Consistent behaviour can be nurtured, however. By nurturing a few desired behaviours, a sought-after organisational culture is more likely to develop. This focus is served well by the concept of Guiding principles.

Guiding principles are not rules, because rules are typically prescriptive and describe what can and cannot be done. They are not objectives, either, as guiding principles are interpretable. They possess a high degree of flexibility, while objectives should always adhere to the SMART rule of thumb.³ Finally, guiding principles are not habits, as habits are traditionally, out-of-date or unchecked actions that are routinely applied. Instead, guiding principles are a small collection of memorable expressions of behaviour—about three to six in total. They describe behaviour that must be present in order to fulfil strategic and brand aims. Interestingly, guiding principles are useful regardless of the changes in circumstances. Thus, even in times of instability, guiding principles represent the inherent behaviour that individuals can turn to and depend on. Together, they underpin an organisational identity and are necessary to nurture a desired culture. A good example is the following 'Everything in moderation, nothing in excess.'

This phrase when applied across a number of individuals can have different interpretations. To some, the phrase indicates the need for a steady, even approach. To others, it might mean that an extreme intake or exposure is acceptable—on occasion, but not regularly. In all cases, individuals will be able to respond in a manner that is in keeping with the desired behaviour, but that suits their situation. Consider too the guiding principle of face to face. To customer-facing staff, its meaning might be very clear—be with the customer whenever possible. To backroom staff, however, it might have usefulness in terms of how they treat email or how feedback is provided to colleagues.

The power of guiding peinciples is that they can be communicated in a straightforward manner, and yet their meaning is always personal to each individual and open to interpretation. The combination of identity and guiding principles is a mobilising force for organisations. Together, they help to form employee behaviour and to channel employee actions and decisions in desired directions. As a result, the organisation becomes more adaptable in terms of the changes it faces, and yet will be consistent in its response. Meanwhile, employees are made more aware of the aims of the organisation and are actively engaged in delivering its success. They are able to live the brand.

A cautionary tale

Guiding principles, together with identity, should hold meaning for the individuals who use them. This is best achieved by allowing a significant cross-section of the organisation to develop them. It is not always possible that one set of guiding principles will serve the whole organisation and some limited regional or team variation should be encouraged. The process should be highly integrated and inclusive. However, the commitment to involve staff must be genuine and purposeful. It must be supported by the presence and involvement of senior managers. Employees do notice when they are being served a placebo process. Less than genuine attempts to involve staff can result in far fewer committed people than desired—perhaps even an employee revolt. Having a few members of staff involved is a far cry from having an entire workforce mobilised and committed to the cause. Martina Navratilova expressed it fittingly when she described the dedication required to achieve sporting excellence—'It's like ham and eggs. The chicken is involved, the pig is committed.'

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WHERE IS THE CUSTOMER?

Thus far, this paper has concentrated most of the discussion on the organisation itself—not the customer. This is deliberate because it

• illustrates the yawning gap in internal focus;
• establishes an appropriate sequence of events required and
• demonstrates the amount of effort that is necessary in order to deliver desired customer experience.

This in-depth focus on internal matters provides two key brand management deliverables. Firstly, it builds a robust foundation for stimulating desired internal attitudes. These, in turn, become products and services that deliver a valued customer experience. Secondly, undertaking exercises of understanding and behaviour ensures that downstream activities become easier to address and are implemented with greater consistency.

As the mantra suggests, the customer is always right. An inward-facing brand process, however, better prepares the organisation to respond to customers in the right way.

GENUINENESS AND TRANSPARENCY—READY TO FACE THE WORLD

In today's marketplace, it is important that any presentation made to a customer needs to be wholly genuine. Further, the organisation that delivers the product or service needs to be transparent. This need for genuineness and transparency does not stem from brand management manuals. Rather, this is a necessary organisational response to today's consumers, who are armed with choices, control and the tribal nature of communities.

Choices, control and community

In recent times, consumers have gained access to new and powerful tools. In the main, these consumer tools refer to new communication technologies such as the internet, mobile telephony and peer-to-peer connectivity. Less hyped, enabling technologies such as increasing digital storage capacities (ie the ability to access, store and transfer large volumes of information) are also critical consumer tools. While each of these technologies no longer represents stirring news on their own, none of them should be underestimated in terms of the lasting social change thae they are introducing. They have the capacity to leapfrog technology generations, connect previously isolated areas, enable the connected portion of the planet to communicate and they provide access to an ever-increasing sea of information.

In brand management terms, these tools have created a state of caveat venditor, where markets provide near limitless choices and the consumer is able to control the exchange. If the company cannot respond, a raft of alternatives is just a mouse click away. Of particular concern for brand mangers is that traditional systems of trust and relationship building are changing at alarming rates. The current generation is the first to be exposed to an endless landscape of sources of trust and the ability to bypass middlemen. As recent as the late 1980s, for example, there were only a few widely acceptable sources of news. Now, news is available from numerous providers, aggregators and commentators—whether in the form of traditional institutions, blogs or others. Indeed, many consumers of news have also become commentators and publishers in their own right.

A gathering storm

In strategic and brand terms, this means that segments of customers can band together—practically overnight—and shift organisational decisions in a way that has never been possible before. A few activists can cause years of unwelcome press and lasting grief with court cases against organisations like McDonalds.⁴ Brand reputations can suffer from reported employment practices in manufacturing assembly plants.⁵ During the construction of this paper, vegetarians united to protest a decision by Masterfoods—makers of Mars and Twix chocolate bars—to use animal rennet in some of its products. The result? Masterfoods publicly admitted that it had made a mistake and reversed the decision.⁶ It is now reported that they are reviewing the broader product range with the diets of vegetarians in mind.⁷

Finally, an illustration involving Apple's customer base shows the variety of involvement by informal customer tribes over time. From its inception, Apple has attracted an enormously loyal customer base.^{8, 9} This was true even during Apple's lethargic progress in the 1980s. In those dark days, lore has it that some near-fanatical customers even loitered in computer stores to promote Apple products to would-be buyers. Surely this was a welcome if not unexpected asset for Apple at the time. In recent times, however, that same loyal base has applied pressure to Apple itself—with expert leadership from Greenpeace—to improve Apple's eco-friendly practices.¹⁰ The success of this orchestrated campaign makes the clear point that no brand can ignore the mobilised wishes of its customer base, particularly, a famously loyal one.

The need for transparency and genuineness is not a marketing tool or a branding fad. It is not a management theory for organisational development. It is an irreversible fact of business life that every organisation must learn to address. This need will only increase as consumer tools improve and as more people have access to them.

Brands can no longer state unrealistic statements of aspiration. The truth is that they never should have done so. Now brands, or at least those that aspire to build valued customer experiences, can only state what the organisation can realistically live up to. This requires learning for some, as it is not necessarily the marketing mix that brand managers learned from the era of Madison Avenue thinking.

VALUES—THE CUSTOMER CONNECTION

Brand values are one of the more familiar terms used by businesses and brand managers. Brand valuee are also familiar for many customers. This is justifiable, as values are tangible brand management tools to be shared with customers. Organisations should openly state their values and ensure that they are represented in their activities. Simultaneously, customers are able to use the values as benchmarks to evaluate the success of their exchanges with the organisation.

Brand values are more resident in the customer domain than identity and guiding principles, discussed previously. Identity and guiding principles are the strategy in flexible form, and help the employees to be the strategy and live the brand. In contrast, brand values are the currency of customer experiences. Each experience can be considered as positive or negative, in a brand sense. Where the brand values are present in a customer exchange and supported by the actions of staff encountered, the transaction can be considered a positive one. In these positive exchanges, the brand is reinforced and the relationship deepens as a result. In contrast, negative transactions occur when the brand values are not evident in the transaction. Here, the customer completes a transaction (or aborts it) but has a less clear understanding of the brand and its position.

Brand-based organisations would do well to treat these measures of brand values as importantly as they do other measures of success. This is because the degree to which brand values are communicated is directly related to how much the consumers buy into the actions of the company and its longer-term perspective.

PUTTING IT ALL TOGETHER—A CASE STUDY

The mobile telephone company, Orange, provides an excellent case study for review. Orange was a fast-growing, brand-based and industry-influencing organisation, particularly in the mercurial heyday of 1994–2003. It was the last of four players to launch in the crowded UK market and was heavily dependent on a differentiated position. From this unlikely position, Orange proceeded to excel at providing excellent customer experiences.¹¹

Like many organisations, however, Orange also faced a number of operational issues, internally and externally. Some examples included—dealing with interdepartmental rivalries, supplier inconsistencies, overcoming the communication needs of a large employee base and management and staff mismatches at various levels. Again, these are common issues that many organisations face. Orange, however, was able to regularly overcome these issues, or at least manage them, by demonstrating its strong sense of organisational purpose and by encouraging employee engagement with the brand. The brand values were thoroughly incorporated into the entire organisation—product development meetings, personal development, employee achievement citations and much more.

During the period mentioned above, a strong sense of understanding and awareness existed in the organisation. It would not have been out of place for a highly technical meeting on telecommunications platforms and infrastructure to close with a discussion on how to make the chosen concept look and feel Orange. Further, the senior team, and in particular the CEO, regularly and personally conducted visible deeds that reinforced the values. These deeds were visible to the organisation and were passionately recounted, until they became symbols of the organisational identity. They developed into rich seams of company lore that were ardently repeated.

Below are two examples from the period that illustrate

• one employee's personal interpretation and application of brand values and
• how senior management deeds can build lasting, purposeful narrative.

Doohickey Day

Many technology companies face a challenge in getting the marketing team to understand the technology team and vice versa. Communications between the two groups can become sterile, even where eest intentions are present, normally due to a lack of understanding between the two groups. Orange was no exception. A unique solution for Orange was developed, however, by one of its engineers. He created a forum for sharing technical developments in an engaging format, which the marketing team would appreciate. The concept was called Doohickey Day, named for the way that engineers in the Dilbert cartoon strip sometimes convey key technologies to their colleagues.

The forum consisted of engineers who would present innovative and upcoming technological concepts to a crowd of (largely) marketing people. The attendees all sat at round tables, each with a large red button in the centre. Each button played a unique sound when pressed. When speaking, the technology presenters were not allowed to use acronyms or jargon to describe the concept. If this did occur, the attendees could 'buzz' the speaker by pressing the red button. At the end of the day, the speaker who had the most buzzes against him was given a penance. The penance? They were made to work in the marketing department for a day!

This process tackled an age-old issue of inter-department communication, but did so in a way that was engaging. In fact, the whole exercise was straightforward, refreshing, dynamic, honest and friendly—reinforcing the five espoused Orange values.¹² Most importantly, the concept was created out of an employee's personal understanding of how the brand values could be applied to solve an internal issue. It is just one of the many ways that an internal brand management focus helped to significantly influence the workings of the organisation and ultimately, the services that were developed for customers.

Customers missing in the boardroom

A second example focuses on just one visible senior management deed that carried particular resonance throughout the organisation. It involved two members of the Corporate Strategy team, who were tasked with presenting a concept to the Executive Board. While presenting the early portion of a PowerPoint presentation, the CEO, Hans Snook, thanked the two strategy representatives for their effort and asked them to leave. The presenters quickly pointed out that they were not finished and that they still had more pages to discuss. Mr Snook replied that given that they had already presented a number of pages and that they had not yet mentioned the customer, they were indeed, finished. The embarrassed presenters duly left the now silent boardroom.

The impact of this brief episode was immediate and far-reaching. First, it concentrated the minds of the strategy team for that particular presentation and for every subsequent piece of work undertaken. Secondly, the board members too took away additional insight that day into how the CEO was absolutely determined to represent the customer at all costs.¹³ Finally, stories about that day meandered throughout the organisation, establishing a firm body of lore about the importance of remembering the customer and it served as a constant reminder to the whole of the company.

Talent spotting

Readers might see these two examples and look for the role of the brand manager in both, for neither example is a result of a brand-led, marketing initiative. One example cited the insight of a single employee and the other referenced the strong personality of the CEO. Nevertheless, the role of brand managers is still key in both. The stories show the underlying need for brand managers to recognise when brand values are being enacted and to support and endorse these activities. Eventually, support from brand managers with regard to Doohickey Day helped it to grow from a small gathering of people to a highly engaging exchange for hundreds of attendees. Separately, brand managers religiously built the CEO's insistence of putting the customer first in every communication exeecise.

Brand management in these instances did not translate into the clever invention and leadership of a specific project. Actually, it required the wisdom to locate good values-based examples when they occurred and the dedication to support them thereafter.

Benefit for the customer

The Orange example is also beneficial for seeing how the brand values were reiterated externally, in customer exchanges.

From the outset, Orange presented an interesting proposition that people wanted to be a part of. At launch, in 1994 for instance, no product-specific materials were used. Instead, a broad brand awareness campaign was built, in an industry that was woefully lacking in powerful consumer brands. It hinged on the phrase the future's bright, the future's Orange, a phrase that is still immensely popular today and that is politely modified with wordplay in media coverage. Below are some examples of how Orange reinforced the five brand values, particularly in circumstances of customer experience.

Friendly and straightforward

 

The values of friendly and straightforward were in widespread use at all Orange touchpoints. Innovative solutions at that time are now readily recognised as industry standards. These included uncluttered shop environments, a reduced number of simplified talk plans and the absence of technology in all advertising. Customers readily bought into a lifestyle concept instead of making independent, product-based, purchasing decisions. Presentation material relied on brief, but clear phraseology and powerful, supportive images. This approach was in complete contrast to an industry that was technologically oriented and rife with complex explanations. Philosophically, the friendly perspective was internally viewed as a child leading an adult into a safe and rewarding future. Thus, advertising often used children's concepts such as bicycles and kites, or simple line drawings to explain services.

But even the name Orange, while highly respected today, was seen as innovative and unusual. Practically every operator name at that time featured some aspect of mobile telephony—words like phone, net or cell—and thus emphasised technology. A few company names existed outside the technology sphere, but the companies failed to market themselves in a nontechnological way. Today, this use of a company name to distance the organisation from mobile technology is in widespread use—Wind, Blue, O ², 3 are some specific examples—but the process began with Orange.

Honest and dynamic

 

These values were reiterated in several specific and unique offerings for the industry. Per-second billing and caller identification represented the initial manifestations of honesty and dynamism. Until the arrival of Orange, mobile users paid for minutes or portions of minutes even when using the mobile to make a call of only seconds. The concept of caller identification was unthinkable. Now, per-second billing and caller identification are worldwide industry standards. Other industry-leading examples included the Orange Value Promise, which gave customers the chance to use other operator tariffs on the Orange network if desired and the Orange Network Promise, where credit was given to users who experienced network connectivity issues.

Orange also influenced the analyst community. Prior to the arrival of Orange, operators were fixated with average revenue per user (ARPU). While ARPU was, and still is, a critical measure, Orange was nevertheless able to introduce the concept of Customer Lifetime Subscriber Value (CLSV). This was a measure of APRU and customer churn, which expressed value over the lifetime of a customer relationship. The analysts of the industry lauded it, as it suited the long-term payback nature of mobile network investment.

Most importantly, honesty was evident in customer relateonships. For example, telephone-based customer service staff would willingly indicate to customers when it was felt that they were paying too much by subscribing to the wrong tariff. Customers, pleasantly surprised, would happily migrate to the lower-priced tariff, but thereafter feel inclined to stay with the network longer, underpinning the CLSV perspective above. This is an example of how an extensive internal focus on being the strategy and living the brand ensured that the customer expectations were not just met, but very often exceeded at each exchange.

Refreshing

 

Collectively, the Orange position represented a refreshing perspective for the industry. Technology was relegated, customer needs were emphasised and communications were clear, but concise. Moreover, the organisation expressed an ability to see beyond its services and even developed the ability to laugh at itself. A good example of this phase was in a run of print advertising that listed activities that could be accomplished with the mobile switched on or switched off. Separately, cinema advertisements of the fictional Orange Film Board reinforced a refreshing perspective. Here, the 'board' cheekily pitched bogus film scripts with the mobile phone as the star, before stating the core message of Don't let a mobile phone ruin your movie.

FINAL CAUTION—BE CAREFUL WHAT YOU WISH FOR

Striving for excellent customer experiences is what Orange sought and is what most organisations seek. It is difficult to achieve and maintain excellence, as this paper has indicated. Worryingly, however, there are some additional, and perhaps unexpected, pitfalls for successful brands.

Great brands attract talent. People want to be associated with them. They sense the opportunity to display their abilities. Over time, however, great brands attract idlers too. Idlers are those people who are good at doing very little, surviving instead on the efforts of the people around them. For them, there is less to do in a successful company. They can be more difficult to locate, and they share in a larger reward than if they worked in a lesser organisation.

Great brands can also suffer from too much of a good thing. Messages that are constantly stated, but are poorly reinforced by actions, can lead to traits of arrogance or complacency in the organisation. Soon, the once valuable programme of community building is perceived as nothing more than corporate propaganda. Sadly, an unending diet of statements, without positive reinforcement, can bring about a culture that is at odds with the brand position that is being espoused.

Finally, great brands can be poor at knowing when the period of success is over. No organisation is excellent forever. In fact, the life expectancy of organisations is quite low, according to Arie de Gues.¹⁴ While at Shell as Head of Planning, he searched for benchmarks from other organisations that were, like Shell, at least 100 years old. Interestingly, he and his team found only 40 firms of that age. They concluded that organisations could indeed last longer, but that many of today's company systems do not nurture this kind of tenure. The result of shorter-term systems is that most organisations will eventually face fundamental change. This could be in their marketplace, political system or in the loss of a leader. Each of these examples indicates a need to re-evaluate the emphasis in strategy and brand management. The issue here is that while poor and average organisations live in a very real world of knowing that the end could occur at any time, successful organisations are often blind to anything other than business-as-usual expectations.

CONCLUSION

This paper has discussed brand management and the customer experience. This has been done not by dissecting brand management into its specific components, but by illuetrating the robustness of brand management when placed appropriately in an organisation. The paper has also highlighted the need to supply employees with tools—identity and guiding principles—to interpret and personally apply organisational attributes. Among other benefits, these employee tools help to breed a consistent and high-quality customer experience externally. Both customers and organisations can determine the overall worth of individual customer exchanges by the presence of brand values.

Finally, it is worth reiterating that people are the key ingredient in any branding effort. It is the actions of people inside an organisation that feed the experience of those outside the company. The journey of providing quality customer experience is long and can be arduous. It begins at the heart of an organisation. It begins with employees who are being the strategy and living the brand.