How Is an Iconic Social Business Brand Created? The Case of the Bangladeshi Brand Aarong

Masterarbeit , 2016 , 76 Seiten , Note: B+

BWL - Allgemeines

The aim of the case study is to explore how Aarong being a social business became an iconic Bangladeshi brand and how it received its brand loyalty.

An attempt was made to explore relationships of 4 independent variables of iconic brand which were attributing to brand loyalty in driving the high business growth of Aarong. In order to understand the iconic brand’s concept the key factors such as brand personality, brand myths, brand storytelling, product’s design and quality were identified from the literature reviewed.

In order to identify the relationship, framework was developed, how brand personality, brand myth, artisans’ storytelling, product’s design and quality that had facilitated, Aarong, to accelerate high business growth by cultivating its brand loyalty with the support of visionary leadership and innovative organizational culture. A cross-sectional qualitative approach was taken due to the interpretivist nature of the study, where both focus groups and in-depth interviews were conducted with key personnel of Aarong including the management team members, heads of the departments (HODs) and key people involved in marketing and branding. The case was narrated as per the timeline set following the framework of the case.

From the findings of the case, it was found that the Aarong needed to focus in three major areas: more communication and cultivation of the core iconic factors of Aarong brand through marketing and promotional activities, market expansion through crafting realistic competitive strategies in order to cater second and third tier city/town of Bangladesh, and finally, value chain reengineering as well as process reengineering in order to solve the dual challenge problems and bring the agility in fulfilling customers demand. From the case findings it was appeared that other issues associated Aarong in a position to be improved with proper planning and practical implementation.

Finally a structure of an integrated supply chain and low-cost capital-intensive mass-production was proposed in order to meet up the increase demand from the potential customers as it had a strategic plan to cater global market through its e-commerce services.

TABLE OF CONTENTS

Table of Contents

List of Tables

List of Figures

List of Abbreviations

Acknowledgements

Executive Summary

Chapter 1
INTRODUCTION
1.1 Background
1.2 Company information
1.2.1 Overview of Aarong
1.2.2 The beginning of Aarong
1.2.3 Aarong-a socially driven business
1.2.4 Aarong model
1.2.5 Aarong’s current position
1.3 Theme of the case study
1.4 Objectives of the study
1.5 Scope of the study
1.6 Limitation of the study
1.7 Chapter framework

Chapter 2
LITERATURE REVIEW
2.1 Introduction
2.2 Meaning of Brand
2.3 The concept of iconic brand
2.4 Product’s design and quality
2.5 Visionary Leadership
2.6 Organizational culture
2.6 Innovative culture and working process
2.7 Brand loyalty
2.8 High Business growth
2.9 Summary

Chapter 3
CASE FRAMEWORK AND METHODOLOGY
3.1 Introduction
3.2 Study framework
3.2.1 Case framework
3.3 Proposed methodology
3.4 Data collection
3.5 Timeline events
3.6 Summary

Chapter 4
CASE NARRATIVE
4.1 Introduction
4.1.2 The genesis of Aarong brand
4.2 Visionary leadership
4.3 Product’s design and quality
4.4 Aarong’s brand personality, myths and storyteller brand image
4.5 Innovative organizational culture and working process
4.6 Brand loyalty
4.7 Achievement of business growth
4.8 Summary

Chapter 5
DISCUSSION OF FINDINGS
5.1 Introduction
5.2 Findings from the Interviews
5.3 Major findings of the study
5.4 Summary

Chapter 6
CONCLUSIONS
6.1 Introduction
6.2 Conclusions
6.3 Recommendations
6.4 Summary

References

Appendices

List of Tables

2.1 Differences among the branding models

5.1 Interview respondents from Aarong

5.2 Marketing mix strategy of Aarong

List of Figures

1.1 The process flow of Aarong

1.2 Competitive market position of Aarong

2.1 The three levels of culture

2.2 Archetypes of organizational culture

3.1 Framework of iconic brand and brand loyalty

3.2 Timeline events

4.1 Aarong’s retail space growth

4.2 Upward trends in Aarong’s sales growth

List of Abbreviations

Abbildung in dieser Leseprobe nicht enthalten

Acknowledgements

All praises are clue to Almighty Creator, the Great, Gracious and Merciful, Whose blessings enabled the author to complete this research work successfully. The author is grateful to them all who made a contribution to this study, although it is not possible to mention all by names.

In particular, the author takes the opportunity to express his deepest sense of gratitude to his honorable Supervisor and Dr. Travis Perera and Ms. Surani S. Dias, Faculty and Co-Faculty Members of Postgraduate Institute of Management, University of Sri Jayewardenepura, Sri Lanka for their inspiration, valuable suggestions, constant guidance and intensive supervision throughout the period of the study and preparation of this case study.

The author takes an opportunity to express his profound gratitude and sincere appreciation to Prof. Ajantha Dharmasiri, Director, Postgraduate Institute of Management, University of Sri Jayewardenepura, Sri Lanka for his creative suggestions; guidance, constant inspiration and moral support from beginning to the end of the work have greatly contributed to the completion of the study. The author also wishes to express his sincere appreciation and indebtedness to all other faculty and co-faculty members and administrative staffs of Postgraduate Institute of Management, University of Sri Jayewardenepura, Sri Lanka, especially Dr. A K L Jayewardena and Mr. Jayantha Ranapura and his team for their kind cooperation, cordial inspiration, guidance and continuous counseling during the tenure of learning process as well as the tenure of conducting this study.

The author desires to express his special gratitude to all the respondent Aarong’s employees and management team of the study area for their cordial co-operation during data collection period. Special and thankful appreciation is also due to the COO and Senior Director of Aarong for their kind approval to conduct this study on Aarong.

Special and thankful appreciation is also due to his MBA Team mates, colleagues and friends namely, Nadie, Lakshan, Shuvo, Melitah for their fellow feeling and encouragement during the learning period. Last but not the least; the author expresses his immense indebtedness, deepest sense of gratitude and profound respect to his parents and beloved wife who had been a constant source of blessing, inspiration and encouragement for his higher study.

The Author

Executive Summary

The aim of the case study was to explore how Aarong being a social business became an iconic Bangladeshi brand and in getting its brand loyalty. An attempt was made to explore relationships of 4 independent variables of iconic brand which were attributing to brand loyalty in driving the high business growth of Aarong.

In order to understand the iconic brand’s concept the key factors such as brand personality, brand myths, brand storytelling, product’s design and quality were identified from the literature reviewed.

In order to identify the relationship, framework was developed, how brand personality, brand myth, artisans’ storytelling, product’s design and quality that had facilitated, Aarong, to accelerate high business growth by cultivating its brand loyalty with the support of visionary leadership and innovative organizational culture.

A cross-sectional qualitative approach was taken due to the interpretivist nature of the study, where both focus groups and in-depth interviews were conducted with key personnel of Aarong including the management team members, heads of the departments (HODs) and key people involved in marketing and branding. The case was narrated as per the timeline set following the framework of the case.

From the findings of the case, it was found that the Aarong needed to focus in three major areas: more communication and cultivation of the core iconic factors of Aarong brand through marketing and promotional activities, market expansion through crafting realistic competitive strategies in order to cater second and third tier city/town of Bangladesh, and finally, value chain reengineering as well as process reengineering in order to solve the dual challenge problems and bring the agility in fulfilling customers demand. From the case findings it was appeared that other issues associated Aarong in a position to be improved with proper planning and practical implementation.

Finally a structure of an integrated supply chain and low-cost capital-intensive mass-production was proposed in order to meet up the increase demand from the potential customers as it had a strategic plan to cater global market through its e-commerce services.

Chapter 1

I NTRODUCTION

1.1 Background

This case study will analyse the historic evolution of Aarong, in the local fashion industry of Bangladesh. The case study will look at how Aarong becomes an iconic brand and in getting its brand loyalty. This case study will also identify how Aarong’s brand loyalty is driving its business growth.

1.2 Company information

1.2.1 Overview of Aarong:

Aarong is the most renowned lifestyle fashion chain of the country. In Bengali the meaning of Aarong is ‘Village Fair’. Aarong is the local ethical brand and it was established in 1978. Its main goal was to solve the social problem by empowering the poor village artisans to lift up from poverty. At this moment, it has been running 15 retail stores around the country and it offers over 100 product lines (Aarong Official Website, 2016). Revolutionizing the fashion industry with finest quality and artistry, this iconic brand blends the traditional with the western in ways that never cease to win customers appeal both at home and abroad (Aarong Official Website, 2016). In scale, Aarong is an exemplary alternative “lifestyle” store, one that is unmatched by any in the larger global context, with only Ten Thousand Villages (North America) and Fabindia (India) following a similar trajectory (Servaes, 2013).

1.2.2 The Beginning of Aarong

From the beginning, Aarong has been driving in league with BRAC’s poverty alleviation mission through economic development and human skills development, focusing on the women empowerment (BRAC Official Website, 2016). BRAC started its operations soon after the liberation war, on resettling and rehabilitating refugees returning from India (Afroj, 2012). In 1976, Abed’s wife, Ayesha, did many of its pre-launch activities through conducting experiment with different crafts items that women could easily make at home (Aarong – Amitava Chattopadhyay, 2015). At that time there were only a few buyers who were scattered across Dhaka. Weeks, even months, would pass before the women would get their payment (Afroj, 2012). Indeed the creation of Aarong came from a need to ensure that poor silk farmers, block printers and embroiderers in Manikganj in central Bangladesh were paid on delivery, and at a fair market price (Aarong – Amitava Chattopadhyay, 2015). Bangladesh has a long history of folk art and crafts but in general art and crafts were infrequently marketed as a meaningful enterprise for the poor (Afroj, 2012). In 1970s, BRAC began searching for a new method in commercialization of arts and crafts products (Aarong – Amitava Chattopadhyay, 2015). The first Aarong outlet opened its doors in December 1978 with jamdani and block printed silk sarees, nakshi kantha quilts, jute products, clay pottery, silver jewellery, leather goods and many other beautiful handmade products (Afroj, 2012).

1.2.3 Aarong - a socially driven business

Aarong the largest, most successful and prominent NGO retail operation in Bangladesh, spearheaded the fare-trade trend and debatably the idea of social entrepreneurship in post independent Bangladesh (Servaes, 2013). The term “social entrepreneurship” made popular by entrepreneur Bill Drayton has its origins in the 1960s, which stems from the idea of creating sustainable yet profitable business models. Social entrepreneurship is concerned with profits as well as societal progress and is considered by many to be the predecessors of green business initiatives that have proliferated in the last decade (Tueth, 2010, as cited in Servaes, 2013). Furthermore, in 2008, Dr. Muhammad Yunus pioneered the term social business. A for-profit company that has a social mission. It is a no loss, no dividend. Social business can be operated the way other business does but while it is sustainable with its operations it is not maximizing profit, instead it stands to serve a social problem (Grimanis, 2012b). Yunus and Weber (2010) propose that, “Social business is outside the profit-seeking world. Its goal is to solve a social problem by using business methods, including the creation and sale of products or services. Unlike a non- profit organization, a social business has investors and owners. However, the investors and owners do not earn a profit, a dividend, or any form of financial benefit. The investors in a social business can take back their original investment amount over a period of time they define.”

As mentioned earlier, the goal of social business is to solve the social problems. This chic brand also began as a novel means to uplift the lifestyle of the socially degraded people (BRAC, 2011). Aarong states that one of its main aims is to reach women in rural as well as low-income urban areas who have many potential income-generating skills, and give them an opportunity of being self-earning and self-sufficient agents (Servaes, 2013). Aarong is “a diverse representation of 65,000 artisans, 85% of whom are women” (Aarong Official Site, 2009, as cited in Servaes, 2013). Throughout the Bangladesh 30,000 skilled artisans have been working under the umbrella of Ayesha Abed Foundation and its production centres (Aarong Official Website, 2016a). In these 13 manufacturing centers, women are trained for jobs in printing, carving, dyeing and a variety of other activities (Grimanis, 2012a). The balance 35,000 artisans work under the wings of independent workshops or traditional family-based artisan groups. However, they come to Aarong for assistance in marketing their goods (Aarong Official Website, 2016a). While Aarong is a well-known leader in fashion, providing thousands of jobs to women in rural areas and Aarong’s profit goes back into supporting other BRAC activities and programs (Grimanis, 2012a).

Aarong in many ways can be called Bangladesh’s first green superstore (Servaes, 2013), since the organization is holding itself responsible for its environmental footprint (Grimanis, 2012a). The toxins and polluted water from production are refined so as not to harm the surrounding environment. Aarong provides accident insurance, health benefits, overtime and meals to their employees. For the poor, working for Aarong provides a unique environment (Grimanis, 2012a). Apart from the wages that the workers receive as compensation for their skilled labour, the organization gives their employees access to education, health care, and legal aid, which aids them in making more informed choices about their lives (Citing website: Brac Official Site, Retrieved April 2009, from www.brac.net; Citing website :Aarong Official Site, Retrieved April 2009, from www.Aarong.com, as cited in Servaes, 2013).

Aarong has been so successful because of the infrastructure and network of BRAC. With BRAC’s resources and knowledge, they were able to create a true social business, a profitable operation with a social mission. Social Business, however, will not compromise on human and environmental integrity and is dedicated to making profit to ensure that it can continue its social mission. For Aarong, profitability ensures that 65,000 employees have the opportunity to develop and better their lives and the continuation of the BRAC programs that Aarong profits fund (Grimanis, 2012a).

1.2.4 Aarong Model:

In 2015, Aarong operated 15 retail stores spread across Bangladesh, supporting over 65,000 artisans, 85% of whom were female. All over the Bangladesh more than 40,000 female artisans work directly for Aarong in13 production centers and 647 sub-centers of AAF. The women Aarong employed are among the most disadvantaged. Aarong offers a way out of destitution and the benefits extend beyond the wages earn (Aarong – Amitava Chattopadhyay, 2015). Female workers, who work for Aarong get the day care centres facility for their babies while they work, and also, get the retirement benefit. AAF workers and craftsmen who live in countryside also get a support package from BRAC, including micro-credit fund; agriculture, poultry & livestock, and fisheries; free education for their children; health care including free eye check-ups and glasses, free treatment of tuberculosis and severe illnesses and health education; as well as legal awareness and support. Besides this, more than 35,000 additional other artisans are working at AAF centers. They are making and selling their products to Aarong to support themselves and their families. It is resulting in a total of more than 320,000 direct and indirect beneficiaries (Aarong Official Website, 2016a).

a) Production:

Since it employes workers in various semi-urban and rural areas, Aarong utilizes a decentralized manufacturing process, unlike typical commercial enterprises which tends to concentrate production in an area with low-cost infrastructure and labour supply. Most of Aarong’s products are produced off-site in scattered home locations of workers (Aarong – Amitava Chattopadhyay, 2015).

Figure 1.1: The Process Flow of Aarong

Abbildung in dieser Leseprobe nicht enthalten

Source: Adopted from Aarong’s Documentation Library, 2015

i) Planning Stage and Product Requirements - Starting approximately one year in advance, Aarong retail stores’ sales trends and inventory levels will be analyzed to determine the target quantities of each product line by outlet by month for the next fiscal year.
ii) Design - A dedicated team of 60 designers are employed to come up with the season’s offerings. Using product and quantity requirements establish in the planning stage to facilitate the product design process, designers first work with producers to create product samples, which has to be approved by the General Manager of Design before large scale production could start.
iii) Costing and Merchandising - Once a product sample is approved, the costing department then works with outside suppliers to obtain the necessary raw materials and establish the product costing. Designers will also be paired with a Production Officer who works directly with the producers (i.e., the artisans) and is responsible for managing all aspects of the production process including meeting quantity requirements and quality control. Producers will then be supplied with the necessary raw materials, design instructions and costing information. Working capital is provided to producers through low interest, collateral-free loans and raw materials for select product lines provide on credit. Production completes through either the AAF centre and sub-centres or independent producers.
iv) Quality Control - Quality control requirements are built into each step of the manufacturing process. For example, goods produced through AAF centres or by independent artisans are examined at various stages of production to meet quality standards before being shipped to the main Aarong storage facilities. Once there, they will be re-checked for quality. Only when all stages of inspection are passed are they packaged, tagged and stored before shipping to the retail outlets. Goods that fail inspection are returned to the respective producers for adjustments before final payments are made.
v ) Finished Storage and Inventory Control - The large number of stock-keeping units (SKUs) carried by Aarong meant that it is important for daily sales and monthly production to be closely tracks and records to maintain up-to-date inventory levels, as it does not have a retail outlet for liquidating excess inventory. To liquidate old inventory, Aarong outlets hold one major sale in March and, if necessary, a second one in August. Sub-standard products produced at the AAF centres are sold through local sales centres in Jessore, Kushtia, Pabna and Baniachong.

As a result of Aarong’s decentralized structure it has two main problems: quality control and production scale. While quality checks are in place, many items are made by workers who have little knowledge to the final goods sells at the retail level, and are less able to visualize the look and feel required. To address quality issues, the AAF Management hired outside professionals to teach, supervise and provide live demonstrations in various skills and techniques. The majority are men, teaching trades that had traditionally been male-dominated. The goal is not only to transfer skills but to show what a professional in the trade is able to produce, so that each worker can aspire to a similar level. Scaling up production to meet growing demand is tricky, as the production process is labour- intensive and scattered, so economies of scale are hard to achieve. Expansion is time- consuming and complicated (Aarong – Amitava Chattopadhyay, 2015).

b ) Marketing:

As a retailer, Aarong understands the importance of marketing and is market- savvy. It has a dedicated marketing team to support with all the marketing initiatives, including traditional print and street billboard ad, exhibitions and carefully orchestrated fashion events. In urban, these are now becomes the part of the popular culture of Bangladesh. In 2008, in celebration of its 30th anniversary, Aarong participated in a huge number of fashion shows and sponsored a nakshi kantha promotional event which was held in the National Art Gallery of Bangladesh with the title named ‘the Story of Stitches’. The annual Eid festival – from which Aarong earned 50% of its annual sales – was also a major marketing event, with a new theme every year (Aarong – Amitava Chattopadhyay, 2015).

c) Exports:

In 1986, Aarong went abroad. Starting with first order from Traidcraft, a London based fair trade organization, and given its roots as a social enterprise, Aarong has been successful in creating an export customer base among Fair Trade organizations in New Zealand, Australia, Europe and North America. The majority of exports (85%), which represented about 5% of sales, were in the Fair Trade business. The wholesalers who channeled goods to retail store such as fair trade shops or world shops and usually marketed under the importers’ brand. Nonetheless, Aarong received exposure in the form of taglines or promotional materials that told the story of the social and financial benefits that Aarong provided for its artisans.

Under its own name, Aarong had a London-based franchisee that catered to the needs of the large Bangladeshi community there, who imports products and pays an annual royalty fee. However, in anticipation of launching an e-commerce website Aarong’s franchise business came to an end in 2010. Aarong tried to open retail outlets in Vancouver and London in 1991 and 1992, but due to weak management and lack of proper inventory control, both had shattered by 1994. Commercial sales in mainstream Western markets remained a challenge (Aarong – Amitava Chattopadhyay, 2015).

1.2.5 Aarong’s Current Position:

From its humble beginnings as a way to sell the products of impoverished rural women, Aarong in 2013 was positioned as a fashion trendsetter and the nation’s leading lifestyle brand, with over 100 product categories that ranged from men/women/children’s wear, home decorations and jewellery, to leather and beauty products. On the retail scene, Aarong is a first-mover in many areas. For example, its fusion sub-brand Taaga was able to make a finest category of clothing for young ladies. It is also the first to take up ecommerce amongst retailers. As part of the charm of being a handicraft retailer, pieces are produced in small quantities (150-250 per design) rather than mass produce, with as few as 3-10 pieces for special items. Perhaps because of the rarity factor, Aarong holds around 68% of the total market share in the handicraft industry of Bangladesh. Aarong’s presence has expanded exponentially since 1978 – retail space had grown from its first 1,600 sq. ft. shop to 194,100 sq. ft., with a 36,000 sq. ft. flagship store opened in Uttara in 2011, which took five years to design and build. In an effort to consolidate its brand image and act as a projection of its brand, every aspect of design, from the customized plans for the building to the internal layout and decor, was crafted to international retail industry standards (Aarong – Amitava Chattopadhyay, 2015).

a) Brand Value:

Positioned as the first retail shop in Bangladesh to uphold local heritage and culture through a unique mix of the traditional and contemporary, while protecting Bangladeshi art and the artisans who produce it, brand recognition is strong. BRAC even used the name ‘Aarong Dairy’ to market its milk products; such is the familiarity with the Aarong logo. Aarong outlets are local landmarks (Aarong – Amitava Chattopadhyay, 2015).

b) Customer Profile:

In addition to the local professional urban and middle-class community, its customer base also includes Bangladeshis abroad searching for goods that connects them to the roots and affirms their identity. Customer approval in 2012 remained strong – about 21,000 customers were served per day, and about 5% of revenue came from ‘foreigners’. Aarong has the third largest Facebook fan base in Bangladesh (1 million fans, half of them in the capital Dhaka) (Aarong – Amitava Chattopadhyay, 2015).

c) Market Environment:

In the past, local customers had tended to favour foreign branded cloth/garments as superior, but there was a move back to local products and hand-crafted production. The trend, according to industry participants, was:

“…back to nature and back to naturalness and back to realness. This trend is strongly mixed with a nostalgia trend … as far as material, manufacturing method, packaging and other issues are concerned; it is the high quality, which matters and counts for generating interest in crafts…”

Local talent is creating new designs in tune with the tastes of middle and high-end domestic customers, helping to lure them back to local brands (Aarong – Amitava Chattopadhyay, 2015)..

d) The Competitive Landscape:

Aarong is now much bigger than any of its competitors, at the individual goods level it compets with thousands of retail shops who sell similar goods (often produce at lower cost because they do not incorporate Fair Trade practices). Among Aarong’s competitors were Kay Kraft, Rang, Anjans, Rina Latif, Jatra, Banglar Mela, and OG, some of which had similar social enterprise backgrounds (Kay Kraft, Jatra, Banglar Mela). Ten of the local fashion houses banded together to form DeshiDosh (Bangladesh 10), in a bid to compete with Aarong.

Figure 1.2: Competitive market position of Aarong

Abbildung in dieser Leseprobe nicht enthalten

Source: Adopted from Aarong’s Documentation Library, 2015

Aarong also faces a potential influx of foreign retailers, especially those from India with more commercialized operations and lower costs of production. In addition, competition from online retailers (such as bdhaat.com, HutBazar.com, khubsoorti.com), which can source from anywhere, is mounting inexorably (Aarong – Amitava Chattopadhyay, 2015).

1.2 Theme of the case study

The theme of this case study proposal is “the importance of key driving forces behind Aarong’s brand loyalty in order to accelerate its business growth”. Throughout this case study proposal, the Author will address how these factors are attributing to iconic brand and deriving the brand loyalty.

1.3 Objectives of the study

Specifically the aim of this study is to get the following objectives:

To explore how an ordinary retail store likes Aarong, evolved as a prestigious lifestyle fashion chain in the local fashion industry of Bangladesh.

To identify how brand personality, brand myths and brand storytelling have emerged in Aarong throughout its operational life span.

To discover how these brand personality, brand myths, brand storytelling and product’s design and quality really attributed to achieve the iconic status and hold the loyal customers around Aarong.

To look at how brand loyalty is really contributing to achieving Aarong’s business growth.

To highlight some suggestions for the marketing practitioners so that they can make their brands’ an iconic in the approach of cultural branding.

1.4 Scope of the study

The study will focus on the brand personality, brand myths, brand storytelling and product’s design and quality of Aarong, which have really driven to achieve the iconic status and to create a sustainable loyal customer base around Aarong in order to accelerate its business growth.

1.5 Limitation of the study

Since the proposed study is based on Bangladeshi cultural context, the author might travel Bangladesh for the novel purpose of data collection. As a result of that, the time constraint and travelling cost could be emerged as major limitations for this study.

1.6 Chapter framework

The following helps understand the topic iconic brand and brand loyalty in-depth manner; an extensive literature review in chapter 2 is conducted to understand iconic brand and brand loyalty, product’s design and quality, visionary leadership, innovative organizational culture and business growth theories. In chapter 3 a conceptual framework is developed based on the theories reviewed. Lastly, data collection and analysis methods which the study is going to use are stated in chapter 4.

Chapter 2

LITERATURE REVIEW

2.1 Introduction

This chapter will explain the generic concepts, such as: brand and its functions, brand identification, and branding models and to give the background for further theories of iconic brand and its componential factors (brand personality, brand myths and storytelling), product’s design and quality, innovative organizational culture, visionary leadership, brand loyalty and business growth which are introduced in later parts of this chapter.

2.2 Meaning of brand

The term has been defined in various ways over time. According to the American Marketing Association Dictionary, a brand is the ‘name, term, design, symbol, or any other feature that identifies one sellers product distinct from those of other sellers’ (American Marketing Association Dictionary, 2013, as cited in Gunter, 2016). Davies and Chun (2003) state that brand is everywhere in life; people talk and hear about it all the time. Yet, when people talk about brand, they know vaguely what they refer to. The original meaning of brand is something or someone’s identification mark. The meaning of the brand is more of the concept that consumers have toward the brand (Kim, 1992). Crimp (1990, as cited in Davies & Chun, 2003) also states that market awareness of the brand by current and potential customers should be seen as assets. A brand is considered strong when people can recall the brand name (Davies & Chun, 2003).

a) Brand Identification:

Brand identification is consumers’ ability to identify a specific brand in comparison with other brands (Bergami & Bagozzi, 2000). Identification serves to fulfil consumer’s need for social identity and self-identification (Ahearne, Bhattacharya, & Gruen, 2005). In short, consumers see a brand as an extension of themselves (Kuenzel & Halliday, 2010). Kuenzel & Halliday (2010) also state that once consumers identify themselves with a brand, they are less likely to switch to other brands; hence, brand loyalty is the result of brand identification.

b) The branding models:

The conventional branding models are mind-share branding, emotional branding and viral branding. However, Holt confirms that these conventional branding models may be useful for building other types of brand, but they do not work for iconic brand. Therefore, it is believed to have the other branding model to instruct how to create identity myths to achieve iconic brands. Holt (2004) suggests a set of empirical strategic principles for achieving an iconic brand which is called cultural branding model. The differences among the branding models are presented as in Table 2.1

Abbildung in dieser Leseprobe nicht enthalten

Source: Holt, 2004, p.14

2.3 The concept of iconic brand

Iconic brand is a brand that achieves the status of an icon in consumers’ society at a cultural level. An iconic brand does not only reflect people and the time they live, but also offer myths that support to resolve the society’s contradictions (Holt, 2004). Iconic brands are powerful cultural symbols and they advocate ideologies that resonate and that people care about. Since they play an important role for consumers, they enjoy very strong brand loyalty and are among the most loved and respected brands. These brands inspire not only loyalty, but also enduring affection from their customers (Million, n.d.).

Holt (2004) and Roll (2010) believe that myths and storytelling are key elements for a successful iconic brand while Harquail (2006) and Herskovitz & Crystal (2010) consider a brand as icon when it has a distinctive personality. For this reason, brand personality, brand myth, and brand storytelling are considered as the key componential factors of an iconic brand.

a) Brand personality:

Maehle and Supphellen (2011) define brand personality is 'the set of human traits that associated with a brand’. A brand personality embraces those aspects of the brand that transcend its descriptors and its physique, which, together denote the brand (Kotler, 1996, as cited in Liyanage, 2001, p.168). Herskovitz and Crystal (2010, p.21) state that brand personality can be recognized as an original human or human-like figure who acts as a kind of brand spokesman or icon. For example, Nike endorsed Michael Jordan for its advertising campaign and the image of Michael Jordan was directly transferred to Nike. What it was implied is that any brand can become icon if it carries an appropriate and distinctive personality.

Aaker (1997, as cited in Maehle & Supphellen, 2011) generated five distinct and robust personality dimensions for brands: sincerity, excitement, competence, sophistication and ruggedness. According to Aaker's (1997, as cited in Maehle & Supphellen, 2011) scale, each of the five dimensions encompasses several facets. For instance, sincerity has four facets: down to-earth, honest, wholesome and cheerful. E xcitement also has four facets: daring, spirited, imaginative and up to date. Competence includes three facets: reliable, intelligent and successful. Sophistication can be described by two facets: upper-class and charming. Finally, ruggedness has two facets: outdoorsy and tough.

However, Freling, Crosno and Henard (2011) describe that brand has the ability to appeal to consumers through blending the human traits associated with it. Combining research on attitude theory and measurement models with insights from brand equity research, brand personality appeal is conceptualized as consisting of three dimensions: favorability, originality, and clarity.

Favorability : the extent to which consumers positively regard the brand’s personality. Originality : the extent to which consumers perceive the brand’s personality to be novel and distinct from other brands in the same product category. If a brand embodies original, unique human traits, then consumers might value the brand’s personality more positively, which in turn could drive preferences and purchase decisions. Thus, Freling et al. (2011) anticipate that brand personality appeal will be partially based on the perceived originality of the brand’s personality.

Clarity : the extent to which a brand’s personality is apparent and recognizable to consumers.

Thus, brand personality is one of the important key factors of an iconic brand as it can help a brand to achieve its iconic status.

b ) Brand myth:

Myth comes from the Greek word ‘Muthos’ meaning a fable or story to explain the ambiguity and contradiction of the unexplainable through various culturally understood metaphors (Hamilton 1940; Puhvel, 1987, as cited in Sitki, 2015). Holt and Cameron (2010) define myths are instructive stories that impart ideology. A brand should have suitable myths to achieve its iconic status (Roll, 2010). An iconic brand does not seem to compete in product markets, but they tend to work in myth markets. The right myth, well performed, provides the audience with little awe moments of attention that put images, sounds, and feelings on barely perceptible desires. Customers who find this kind of identity value in a brand that create intensive emotional connections. Emotional attachment is the consequence of a great myth. Thus, the myth embedded in the brand leads customers to associate the product with category benefits, to spread the myth by word of mouth, to emote, and to gather together (Holt, 2004).

Holt (2004) suggests that for today society, myths should focus on the following elements; doing it yourself, breaking stressful social norms, getting over limits and appreciating folk culture with creativity.

Doing it yourself: Slackers may not be interested in rule-bound activities or games. They tend to do everything by themselves with improvisational moods (Holt, 2004, as cited in Ou & Phuoc Luong, 2012). Iconic brands must inspire them to have the feeling that they themselves can do anything that a famous sport-man, a musician, or any other talent can do.

Breaking stressful social norms: Slackers are thought to be nihilists who mock at civility rather than revolutionize it (Holt, 2004, as cited in Ou & Phuoc Luong, 2012). Iconic brands should take advantages of this slacker’s characteristic by creating myths related to social norms and values which are strictly respected to formalize the modern society but they are causing many boring and stressful things.

Getting over limits : Slackers create a new country ideology with the masculine expressions – competing in the most dangerous contests and taking on great risks to achieve a melodramatic extreme. For example, in some sports, featured guys strive to perform crazily without being afraid of their body harm (Holt, 2004, as cited in Ou & Phuoc Luong, 2012).

Appreciating folk culture with creativity : Slackers tend to reclaim what are considered as worthless instead of accepting what corporations have marketed. They would like to show corporations that worthless stuff can be upgraded to valuable stuff with their creativity and imagination. Thus, iconic brands have to involve in myths that embed folk culture and encourage the audience’s creativity (Holt, 2004, as cited in Ou & Phuoc Luong, 2012). The creativity has the special meaningfulness when it makes the life more valuable and beautiful from the stuff considered as worthless.

A brand which has myths can be an ionic brand by intensifying its customer’s emotional attachment. Thus, Brand myth is another key componential factor of iconic brand.

c) Brand storytelling:

Storytelling is a well-known and ancient art form (Herskovitz & Crystal, 2010). Bagozzi and Nataraajan (2010) discuss about brand–consumer storytelling with the idea that marketing should be put in place where people need it to feel happy. A brand, with interesting stories, can make the consumers to feel happy and this also becomes the focus of today’s marketing role (Woodside, 2010). Holt (2004) states that in terms of cultural branding, storytelling is essential for building iconic brands as it determines which myths need to be opted and how to communicate the myths to the consumers. Herskovitz & Crystal (2010) state that Storytelling must be considered as key factor for branding success in both cases of product brands and company brands because all corporate behaviours and communications can be embedded in brands which influence customers’ emotions and experiences with the company or product. A good storytelling should deal with scarce resources, difficult decisions, despite risks, and uncovered truths. Great storytellers should know how to deal with the conflicts between people’s subjective expectation and cruel reality (Woodside, 2010). On the other hand, Holt (2004) argues that an excellent storytelling comes out of a great cultural brief which has a good outlined story, authentic myth, and charismatic type of communication.

Well-outlined story: For an iconic brand, creative ideas (such as: myths, stories, and so on) represent the brand’s proposed functions in the culture rather than being simply tools to deliver benefits. Marketing managers should strictly involve themselves in dealing with these issues to have a good myth treatment - a suitable outlined story for the myth to resolve some cultural contradiction (Holt, 2004, as cited in Ou & Phuoc Luong, 2012).

Authenticity: Brand myths should be extracted from sources of the populist worlds which are perceived as authenticity by audiences. Populist worlds are defined as autonomous places where human’s actions are thought to be guided by intrinsic values, not by money or power (Holt, 2004, as cited in Ou & Phuoc Luong, 2012).

Skepticism: Authenticity is a trait that all myths need to follow. However, it is also important to hold the attention and curiosity of audiences when brands tell the myths. Thus, it is suggested that a story making skepticism for the audiences should be created.

Charismatic aesthetic: An iconic brand has to embed the charismatic communication of myths to get audiences’ attentions. Charismatic aesthetic is a distinctive and persuasive style representing the populist world from which a brand speaks of its myths (Holt, 2004, as cited in Ou & Phuoc Luong, 2012).

Thus, brand storytelling can be considered as an important componential factor of iconic brand.

[...]

• Veranstaltung: MBA
• Note: B+
• Autor: Muhammad Salim Reza Jony (Autor:in)
• Erscheinungsjahr: 2016
• Seiten: 76
• Katalognummer: V456847
• ISBN (eBook): 9783668948624
• Sprache: Englisch
• Schlagworte: Iconic Brand, Brand Loyalty, Leadership, Social Business