Brand Management in Small to Medium-Sized Enterprises
by Pierre Berthon, Michael T. Ewing, and Julie Napoli
留學(xué)生MBAdissertationAlthough an impressive body of literature has emerged focusing on the criticalactivities involved in brand management for larger organizations with wellestablishedbrands and substantial marketing budgets, no research has been undertakento examine branding within small to medium-sized enterprises (SMEs). Thepresent study therefore seeks to assess the nature and scope of brand managementwithin an SME context. Findings show significant differences between small andlarge organizations along 9 of the 10 brand management dimensions reported inKeller’s brand report card. Moreover, different brand management practices areassociated with business performance in SMEs. Implications of the study are highlighted,limitations noted, and directions for future research outlined.
Introduction
The marketing literature has longrecognized the strategic importance ofeffective brand management (Berthon,Hulbert, and Pitt 1999a; Keller 1998; Lowand Fullerton 1994; Park, Jaworski, andMacInnis 1986). Two research streamshave emerged: the first focuses on providing
an overarching brand managementframework to guide managerialdecision-making (Keller 1998; Macrae1996; Aaker 1991; Park, Jaworski, andMacInnis 1986); whereas the second concentrateson various discrete aspects ofthe process (Aaker and Joachimsthaler2000; Berthon, Hulbert, and Pitt 1999a;de Chernatony and Riley 1998). This literaturesuggests that organizations thatdirect their managerial actions and practicestoward the development, acquisition,and leveraging of branded productsand services will be better placed to seepositive gains in performance (Noble,Sinha, and Kumar 2002; Hankinson2001). However, two notable gaps in the
*All authors contributed equally. Names appear alphabetically.Pierre Berthon is Clifford F. Youse Chair of Marketing at Bentley College.
Michael T. Ewing is professor and head of the Department of Marketing at MonashUniversity.
Julie Napoli is senior lecturer in marketing at the University of Melbourne.
Address correspondence to: Julie Napoli, School of Marketing, Curtin University of Technology,GPO Box U1987, Perth, WA 6845. Tel: (618) 9266 7288. Fax: (618) 9266 3937. E-mail:[email protected].
Journal of Small Business Management 2008 46(1), pp. 27–45
BERTHON, EWING, AND NAPOLI 27
literature can be identified. First, thereis a growing realization that successfulfirms often pursue multiple orientationssimultaneously. This has been referredto as organizational ambidexterity(Berthon, Hulbert, and Pitt 1999b). Morespecifically, the literature suggests thatmarket orientation alone may not alwayselicit desirable results for every type oforganization (Voss and Voss 2000; Christensenand Bower 1996; Frosch 1996;MacDonald 1995; Hamel and Prahalad1994). Empirical studies of the extent towhich organizations focus on alternatebusiness philosophies, such as brandmanagement, are limited. Second, thebrand management literature hasfocused almost exclusively on large, multinationalbrands (forexample, the Interbrand“top 100”). Small to medium-sizedenterprises (SMEs) have been largelyoverlooked. This is surprising, given thatSMEs constitute the vast (numerical)majority of organizations. Could it bebecause SMEs typically lack the capabilities,marketing power, and otherresources of larger organizations (LOs)(Knight 2000; Cohn and Lindberg 1972)?Or do SMEs fail to realize that brands canin fact be established and maintained onrelatively modest budgets (Aaker andJoachimsthaler 1999)? We contend thateven with constrained budgets, SME marketerscan creatively manage and leveragethe full potential of their brands. Thequestion then becomes which branmanagement principles, practices, orphilosophies are most amenable to SMEs.#p#分頁標(biāo)題#e#
To address these gaps, the presentstudy seeks to identify the nature andscope of brand management within anSME context by comparing such practicesto those of LOs. We commence byoutlining the characteristics of SMEs and(some of the) marketing challenges theyface. We then describe the present study,discuss the results, note the limitations,and highlight possible directions forfuture research in this area.SME Marketing
ManagementSMEs account for the vast majority of
organizations in most developed economies(Culkin and Smith 2000; Graham
1999; ABS 1997–1998). By way ofexample, of the 5.7 million businesses inthe United States, only 14,000 employmore than 500 workers (Chaston,
Badger, and Sadler-Smith 2001). Furthermore,SMEs contribute significantly toa country’s gross domestic product,national employment, and export performance(Culkin and Smith 2000; Graham
1999; ABS, 1997–1998).
It has long been recognized that themanagement style, operations, and functions
of SMEs are different from LOs(Knight 2000; Cohn and Lindberg 1972).
The SME owner–manager is often thekey decision-maker and is responsiblefor managing and attending to many ofthe functions performed within the organization,such as banking, advertising,recruitment, or even stationery purchases.
The use of specialists, such asadvertising or recruitment agencies, israre (Culkin and Smith 2000). Furthermore,SMEs often face resource constraints,both in terms of time andmoney, which result in many owner–managers adopting what could bedescribed as a “survival mentality.” Thisis perhaps exacerbated by the fact thatstrategic planning within SMEs is oftenlimited (Huang, Soutar, and Brown http://www.400190.com/dissertation_writing/2002;Orser, Hogarth-Scott, and Riding 2000;Gilmore et al. 1999). As such, the managementstyle within SMEs is one that isvery unique and personal to each firm(Culkin and Smith 2000; Gilmore et al.1999).
Several scholars have been quick toextol the virtues of being small. Theysuggest that unlike LOs, SMEs tend to bemore entrepreneurial, flexible, and innovative,which makes them more adept atserving specialist or niche markets andremaining responsive to customer needs28 JOURNAL OF SMALL BUSINESS MANAGEMENT(Gilmore et al. 1999; Cohn and Lindberg1972). SMEs have more of an opportunityto get close to customers and obtain
valuable feedback, which can then beused to provide them with a customized,value-added service (Gilmoreet al. 1999). In addition, research hasshown that entrepreneurial SMEs have agreater ability to leverage marketingstrategies for entering new product
markets and coping with complex environments(Knight 2000). Furthermore,they tend to exhibit a higher order levelof organizational learning and are moreadept at acquiring and utilizing marketing
information than their nonentrepreneurialcounterparts (Chaston, Badger,
and Sadler-Smith 2001).#p#分頁標(biāo)題#e#
However, research has demonstrated
that SMEs are more likely to experience
problems in marketing, human resourcemanagement, and general business planning(Huang and Brown 1999). Whencombined with a lack of marketingexpertise, difficulties arise in selectingsuitable promotional media, designingcontent, conducting market research,and interpreting marketing information(Raymond, Brisoux, and Azami 2001;Huang and Brown 1999). This is partlya result of limited financial, technologicalandmanagerial resources, lack ofmanagement information systems andconcentration of decision-making with,more often than not, the owner–manager (Huang, Soutar, and Brown2002; Raymond, Brisoux, and Azami2001; Huang and Brown 1999). Furthermore,
marketing tends to be more reactive,in terms of responding to customerneeds, rather than proactive (Carsonand Gilmore 2000). As the businessdevelops, SME managers begin toexperiment with different marketingtechniques, acquiring experience andknowledge as time progresses andbecoming more adept at accommodatingthose marketing practices thatproduce positive results for the organization(Carson and Gilmore 2000).
It seems, then, that some of the conventionalprinciples prescribed in themarketing literature cannot always befully appreciated or applied within anSME context (Carson and Gilmore 2000;
Conant and White 1999; Gilmore et al.1999). The marketing activities of SMEstend to be pragmatic, practical and
adapted to suit the unique needs, circumstancesand abilities of an individual SME(Carson and Gilmore 2000). When constrainedby resources, managers of SMEstend to pursue those activities theybelieve will deliver the greatest benefitto the organization and most effectively
utilize the resources that are available(Carson and Gilmore 2000; Gilmore et al.1999). Furthermore, most marketingprinciples are adapted to suit the uniquesituation of an SME, with many owner/managers relying largely on their intuition,experience or judgment to makesuch decisions (Carson and Gilmore2000).
Brand Management
Most marketing scholars are of theview that a clear distinction can be madebetween a company’s identity/image andtheir reputation. Corporate image isdefined in terms of the publics’ latestbeliefs about a company (Balmer 1998)or the total impression an entity makes
with such publics (Dowling 1994). Corporatereputation, on the other hand,refers to value judgments about an organization’s
qualities, trustworthiness andreliability built up over time (Balmer1998; Fombrun and Van Riel 1997). Thissuggests that corporate reputation ismore durable than image and cannot bedeveloped or altered as quickly (Markwickand Fill 1997). Likewise, it requiresnurturing over time (Bennett and Kottasz2000).
De Chernatony (1999) suggests thatbrand management can help bridge thegap between a brand’s image/identityand its reputation. Brand management isthe process of creating, coordinating andBERTHON, EWING, AND NAPOLI 29
monitoring interactions that occurbetween an organization and its stakeholders#p#分頁標(biāo)題#e#
(Schultz and Barnes 1999), suchthat there is consistency between anorganization’s vision and stakeholders’beliefs about a brand. It is important thatorganizations initially focus their effortson creating an appropriate brand imagethat has a niche in the market place.
Marketing mix elements should be usedto operationalize the concept and communicatethis to a target audience (Park,
Jaworski, and MacInnis 1986). As thebrand (and organization) grows, managerialemphasis should shift towardmaking a brand memorable, ensuringthat positive brand associations canreadily be recalled by consumers andreinforcing the link between a brand(image) and other products within acompany’s portfolio (Farquhar 1989;Park, Jaworski, and MacInnis 1986).Regardless of whether an organization iscomprised of a singular or multiplebrands, it is necessary that marketingbe directed toward establishingand maintaining a positive brand imagein the minds of key stakeholders.Ultimately, this can contribute to thedevelopment of a favorable corporatereputation (de Chernatony 1999).Managing Brands inSMEsSmall business managers generallyaccept that a good corporate reputation isimportant to receiving legitimization fromdifferent stakeholders (Goldberg, Cohen,and Fiegenbaum 2003). However, the difficultyoften arises in terms of translatingthis viewpoint into specific reputationbuildingactivities. Managing the externalimage of a business is one way to buildand enhance its reputation (Goldberg,Cohen, and Fiegenbaum 2003). Althoughsome scholarly attention has beendirected toward SME marketing (Carsonand Gilmore 2000; Conant and White1999; Gilmore et al. 1999), we could findno prior research specifically on brandmanagement in SMEs. Two studies alludeto this issue through a comparison of theorganizational structures and internal culturesof organizations that manage theworld’s top 100 brands and those managingsmaller, or outsider, brands (Hankinsonand Hankinson 1999, 1998). Resultsindicate that some aspects of corporateculture impact the way in which brandsare managed. A third study by Goldberg,Cohen, and Fiegenbaum (2003) suggeststhat few small businesses follow areputation-building strategy and when aneed for “image management” is recognized,
it is often limited to implementinga public relations campaign. As is evidentin the brand management literature,however, the process of managing a corporateand/or brand image certainlycould entail amuch broader set of activities.This suggests that an SME’s approachto brand management differs from thepractices adopted by LOs, which raisesthe question of how brands are in fact,
managed within SMEs. Hence, the followingaxiom and propositions are offered
A1: SMEs and LOs will vary in the extentto which they implement key brandmanagement practices (BMPs).
P1: BMPs differentiate high versus lowperformingSMEs and LOs.
P2: High- and low-performing SMEs willdiffer in the extent to which theyimplement key BMPs.
The Study
Keller’s (2000) brand report card(BRC), which consolidates many of thevarying perspectives on brand management,formed the basis of the questionnaireused in this study. From the BRC, 37items, purported to measure organizationalBMPs and philosophies, were generated.Face validity was assessed by twomarketing academics, whose task was toidentify any overlapping, ambiguous orirrelevant items. This resulted in theretention of all 37 items. We then con-30 JOURNAL OF SMALL BUSINESS MANAGEMENTducted three focus groups with seniormanagers of both small and large organizations,to evaluate each statement forrelevance and clarity. Minor adjustment tothe wording of some statements was#p#分頁標(biāo)題#e#
required, however, all 37 items wereretained for analysis. Each item was thenplaced on a seven-point scale, withrespondents asked to rate the extent towhich their organization engaged in theactivity described. A response of 1
reflected “to a very little extent”, and a 7,“to a very great extent”. The questionnairealso included subjective measures of
organizational performance. Subjectivemeasures have been shown to be reliablein gauging an organization’s performance
(Mintzberg 1996; Pearce, Robbins, andRobinson 1987), and produce results consistent(Dess, Lumpkin, and Covin 1997;
Dess and Robinson 1984). The use ofsubjective measures can also be an effectiveway by which to overcome difficulties
associated with obtaining, what couldbe described as, competitively sensitiveinformation (Caruana, Ramaseshan, andEwing 1998). Furthermore, measuring anorganization’s performance using objective
financial data can be difficult as theinformation may either be unavailable,unreliable or difficult to validate withexternal sources (Sapienza, Smith, and
Gannon 1988).
Sample
Consistent with prior literature, wefocused on organizations that marketedtheir products or services directly to final
consumers (B2C). Industries wereselected based on the Standard Industry
Classification code and specific organizationswithin each sector selected througha random sampling technique. The finalsample consisted of 1,000 organizationsoperating across six broad industries.
Data were collected from the Chief
Executive Officer via a mail survey.
Ninety-two questionnaires were returnedto us unopened, with 263 usable questionnairesretained for analysis. This representsa response rate of 29 percent.
Armstrong and Overton’s (1977) procedurewas used to assess for nonresponsebias. This technique is based onthe assumption that late respondents aresimilar to the “theoretical” nonrespondent.
If no significant differences areobserved between early and late respondents,it can be assumed that nonrespondents
are similar to survey participantsand the effects of nonresponse biasminimal (Armstrong and Overton 1977).
An independent samples t-test was usedto compare responses along the scaleitems between early and late respondents,which were represented by thefirst and fourth quartiles, respectively.
Results indicated that there were no significantdifferences between early and
late respondents. As such, it can beassumed that the probability of nonresponsebias is minimal.
As can be seen in Table 1, bothservice organizations and manufacturersare evenly represented. The majority ofrespondent organizations (78 percent)have been in operation for less than 50years. Furthermore, 63 percent of thesample reported annual revenues of lessthan AU$30 million and employed fewer
than 500 people (85 percent). In terms ofthe demographic characteristics of individual
respondents, the position heldwithin the organization was either that ofChief Executive Officer (66 percent),manager (33 percent) or “other” (1percent). Eighty percent of respondentswere male, 30 percent were youngerthan 40 years of age, 33 percent werebetween 41 and 50 years, 34 percentwere between 51 and 60 years, with theremainder being older than 61 years.Results#p#分頁標(biāo)題#e#
The analysis proceeded in a numberof stages. First, the reliability of itemscomprising the 10 BMPs was assessed.Second, BMPs in SMEs and LOs werecompared and a discriminant analysis
BERTHON, EWING, AND NAPOLI 31performed to see which BMPs differentiatedhigh- and low-performing organizations.
Finally, the BMPs in high- andlow-performing SMEs were examinedthrough an independent samples t-test.
The first stage of the analysis involvedassessing the reliability of items comprisingthe 10 BMPs identified in Keller’s(2000) BRC. To date, these have not beenmeaningfully operationalized. Generally,scales are regarded as reliable for commercialpurposes if the alpha coefficientexceeds 0.7 (for example, Carman 1990).
As can be seen in Table 2, the coefficientalpha for BMP 1 (Brand delivers benefitscustomers truly desire) is marginallybelow this cutoff point, which raisesquestions regarding the reliability of thethree items comprising this factor.Keeping this limitation in mind, BMP 1
(Brand delivers benefits customers trulydesire) was nonetheless, retained forfurther analysis. With respect to BMP 3
(Pricing strategies are based on perceptionsof value), item 8 was deleted as itsubstantially improved the coefficientalpha of this factor. It is evident then thatthe remaining 36 items are reasonablyreliable measures of organizationalBMPs.
The second stage of analysis involvedcomparing the brand managementactivities undertaken by SMEs versus
LOs. The sample was divided into twogroups—the first consisted of those organizations
that employed less than 200people (that is, SMEs) and the secondcomprised LOs that employed more than201 people. Such a classification is consistentwith the Australian Bureau ofStatistics’ definition of small, mediumand large organizations (ABS, 1997–1998). The split yielded 186 small–
medium organizations and 77 LOs. Next,
Table 1
Organizational Characteristics
Valid Percent
Industry Sector Manufacturer—FMCG 20
Manufacturer—Shopping/Specialty Goods 16
Retailer 34
Banking/Insurance Services 9
Other 21
Annual Revenue Less than AU$5 million 23
Between AU$5 and 10 million 20
Between AU$10 and 30 million 20
Between AU$30 and 100 million 17
More than AU$100 million 20
Number of Employees Less than 25 people 9
Between 26 and 100 people 50
More than 101–500 people 26
More than 501 people 15
Years of Operation Less than 10 years 19
Between 11 and 20 years 24
Between 21 and 50 years 35
More than 51 years 22
32 JOURNAL OF SMALL BUSINESS MANAGEMENT
Table 2
Reliability Analysis of BMPs by Item and Dimension
Item Item
Mean
Corrected
Item-Total
Correlation
Alpha if
Item
Deleted
BMP 1: Brand Delivers Benefits Customers Truly Desire (Alpha = 0.6359)
1. Attempt to uncover unmet consumer needs#p#分頁標(biāo)題#e#
and wants
5.12 0.4254 0.5660
2. Focus on maximizing our customers’ productand service experiences
5.54 0.5482 0.4271
3. Have a system in place for getting customers’comments to the people who can effect/implement change
4.80 0.3891 0.6317BMP 2: Brand Stays Relevant (Alpha = 0.7676)
4. Invest adequate resources in productimprovements that provide better value toour customers
5.25 0.4954 0.7624
5. Keep “in touch” with our customers’ tastes 5.34 0.6131 0.6875
6. Keep “in touch” with current marketconditions
5.77 0.5938 0.7078
7. Base marketing decisions on knowledge ofthe current market conditions, customers’tastes and new trends.
5.63 0.6039 0.6934
BMP 3: Pricing Strategies Based on Perceptions of Value (Alpha = 0.5866)
8. Optimize the price, cost and quality of theproduct/service offering to meet or exceedcustomers’ expectationsa
5.67 0.1797 0.7241
9. Have a system in place to monitor customers’perceptions of brand value
3.98 0.5569 0.1950
10. Estimate how much value our customersbelieve the brand adds to our product
留學(xué)生MBAdissertation4.00 0.5062 0.2964BMP 4: Brand Is Properly Positioned (Alpha = 0.7691)
11. Establish “points-of-parity” for our brandsthat are necessary to simply compete in the
product/service category (that is, identify theattributes/benefits that a brand must possessin order to just compete in a category)
4.50 0.6182 0.6750
12. Establish “points-of-parity” for our brandsthat negate the advantages our competitorsattempt to achieve in the product/service
category
4.35 0.7044 0.5690
13. Establish unique “points-of-difference” for
our brands that provide us with a
competitive advantage in the product/service
category (that is, identify the brand
attributes/benefits on which we are clearly
superior)
5.44 0.5027 0.7915
BERTHON, EWING, AND NAPOLI 33
Table 2
Continued
Item Item
Mean
Corrected
Item-Total
Correlation
Alpha if
Item
Deleted
BMP 5: Brand Is Consistent (Alpha = 0.7280)
14. Develop marketing programs that do not
send conflicting messages about our brands
to our target audience
5.11 0.5725 —
15. Adjust the brand’s marketing program to
keep current and abreast with changes in
consumer tastes
4.88 0.5725 —
BMP 6: Brand Portfolio and Hierarchy Make Sense (Alpha = 0.7684)
16. Have a corporate brand that creates a
seamless umbrella for all the brands in our
portfolio
4.76 0.5065 0.7535
17. Ensure that the brands in our portfolio target
specific, well-defined segments, which do not
overlap with one another
4.54 0.6210 0.6857#p#分頁標(biāo)題#e#
18. Ensure that brands in our portfolio fully
maximize market coverage
4.82 0.6229 0.6864
19. Create a brand hierarchy that is well thought
out and well understood by our staff
4.82 0.5416 0.7276
BMP 7: Brand Uses Full Repertoire of Marketing Activities to Build Equity
(Alpha = 0.8597)
20. Design the brand name, logo, symbol,
slogan, packaging, signage etc., for our
products/services to maximize brand
awareness and image
5.51 0.6161 0.8454
21. Implement integrated “push and pull”
marketing activities to target both distributors
and customers
4.37 0.5604 0.8611
22. Ensure that brand managers are aware of all
of the marketing activities that involve their
brands
4.94 0.7690 0.8057
23. Ensure that all people involved in managing
the marketing activities for a brand are aware
of one another
5.01 0.7267 0.8177
24. Capitalize on the unique capabilities of each
communication tool (that is, advertising, PR,
sales promotion, etc.) while ensuring that the
meaning of the brand is consistently
represented
4.68 0.7222 0.8186
34 JOURNAL OF SMALL BUSINESS MANAGEMENT
Table 2
Continued
Item Item
Mean
Corrected
Item-Total
Correlation
Alpha if
Item
Deleted
BMP 8: Brand Managers Understand What the Brand Means to Consumers
(Alpha = 0.8446)
25. Develop detailed knowledge of what
customers dislike about our brands
4.08 0.6767 0.8061
26. Develop detailed knowledge of what
customers like about our brands
4.71 0.6850 0.8053
27. Develop knowledge of the core associations
that people make with our brands, whether
intentionally created by our company or not
4.42 0.6037 0.8254
28. Create detailed, research-driven portraits of
target customers
3.85 0.6229 0.8228
29. Outline customer-driven boundaries for brand
extensions and guidelines for marketing
programs and activities
3.71 0.6786 0.8054
BMP 9: Brand Is Given Proper Support and It Is Sustained over the Long
Run (Alpha = 0.7495)
30. Develop a good understanding of thesuccesses and failures of our brand’smarketing program before it is changed
4.19 0.6197 0.6168
31. Provide our brands with sufficient researchand development support
4.14 0.6582 0.5656
32. Resist the temptation to cut back marketingsupport for the brand in reaction to adownturn in the market or a slump in sales
4.18 0.4638 0.7880
BMP 10: Company Monitors Sources of Brand Equity (Alpha = 0.8939)
33. Create a brand charter that defines themeaning and equity of the brand and how itshould be treated
4.00 0.6786 0.8839
34. Conduct periodic brand audits to assess the“health” of our brands
3.68 0.8022 0.8563#p#分頁標(biāo)題#e#
35. Conduct routine tracking studies to evaluate
current market performance of our brands
4.01 0.7632 0.8653
36. Regularly distribute brand equity reports,
which summarize all relevant research and
information, to marketers to assist them in
making decisions
3.11 0.7633 0.8655
37. Assign explicit responsibility to an individual
within the organization for monitoring and
preserving brand equity
3.82 0.6983 0.8815
aRemoved from dimension and further analysis.
BERTHON, EWING, AND NAPOLI 35
10 BMP dimensions were formed by
summating the items that comprised
each factor. An independent samples
t-test was then used to compare
responses between the two groups along
each of the 10 BMP dimensions. As can
be seen in Table 3, significant differences
exist between SMEs and LOs along 9 of
the 10 BMP dimensions (BMP1 and
3–10), lending support to A1.
Table 3
Comparison of BMPs between Small to Medium-Sized
Enterprises and Large Organizations
Dimension Organization
Type
N Mean S.D. Significance
BMP1 Brand delivers
benefits customers
truly desire
SME 186 5.09 1.09 0.05
LO 77 5.46 1.87
263 5.20 1.37
BMP2 Brand stays relevant SME 186 5.45 0.94 0.44
LO 77 5.55 0.79
263 5.48 0.90
BMP3 Pricing strategies
based on
perceptions of
value
SME 186 4.36 1.09 0.00
LO 77 4.99 1.01
263 4.55 1.10
BMP4 Brand is properly
positioned
SME 186 4.58 1.27 0.00
LO 77 5.11 0.98
263 4.73 1.22
BMP5 Brand is consistent SME 186 4.71 1.29 0.00
LO 77 5.62 0.96
263 4.97 1.27
BMP6 Brand portfolio and
hierarchy make
sense
SME 186 4.54 1.24 0.00
LO 77 5.06 1.05
263 4.69 1.21
BMP7 Brand uses full
repertoire of
marketing activities
to build equity
SME 186 4.65 1.32 0.00
LO 77 5.35 0.89
263 4.86 1.25
BMP8 Brand managers
understand what
the brand means to
consumers
SME 186 3.89 1.26 0.00
LO 77 4.75 1.03
263 4.14 1.25
BMP9 Brand is given proper
support and it is
sustained over the
long run
SME 186 4.03 1.35 0.01
LO 77 4.47 1.22
263 4.16 1.33
BMP10 Company monitors
sources of brand
equity
SME 186 3.33 1.40 0.00
LO 77 4.72 1.53
263 3.74 1.57
36 JOURNAL OF SMALL BUSINESS MANAGEMENT
A discriminant analysis was then used
to identify which BMPs were associated
with superior business performance
among both small and larger organizations.
The sample was split in terms of
size and performance. The index for
organization performance was the composite
of three self-report measures of
performance: return on investment,#p#分頁標(biāo)題#e#
market share and ability to serve customers
better, relative to rivals, (Delaney and
Huselid 1996; Youndt et al. 1996;
Conant, Mokwa, and Varadarajan 1990).
Table 4 summarizes the main results of
four-group discriminant analysis. First,
from the univariate F-test, it can be
observed that all 10 BMPs varied across
the four groups (p < .01). Second, three
discriminant functions are extracted, the
first two are significant at the 0 percent
level, and third is significant at the 28
percent level as measured by Wilks’
Lambda statistic. The first discriminant
function explained 57.1 percent of the
variance, the second function explained
38.0 percent of the variance, whereas the
third function explained 4.9 percent of
the variance. Figure 1 plots the centroids
of the four groups against the first two
discriminant functions. As can be seen,
high-performing LOs load positively on
both discriminant functions, highperforming
SMEs load positively on
function 2 and negatively on function 1,
low-performing LOs load positively on
function 1 and negatively on function 2,
while low-performing SMEs load negatively
on both dimensions. Thus, the first
discriminant function primarily differentiates
between SMEs and LOs, whereas
the second discriminant function primarily
differentiates between high- and
low-performing organizations. From the
structure matrix, it can be observed that
BMPs 10 (Company monitors sources of
brand equity), 5 (Brand is consistent)
and 7 (Brand uses full repertoire of marketing
activities to build equity) contribute
primarily to the first discriminant
function, whereas BMPs 2 (Brand stays
relevant), 9 (Brand is given proper
support and it is sustained over the long
run), 8 (Brand managers understand
what the brand means to consumers), 3
(Pricing strategies based on perceptions
of value), 1 (Brand delivers benefits customers
truly desire), 6 (Brand portfolio
and hierarchy make sense), and 4
(Brand is properly positioned) contribute
primarily to the second discriminant
function.
Further validation for the discriminant
functions is provided by a comparison of
the discriminant functions’ accuracy in
predicting group membership with the
accuracy expected from the use of a proportional
chance model (cf. Hair et al.
1998). The classification results reveal
that the derived discriminant functions
provide an overall accuracy of 64.6
percent against 28.9 percent that might
be expected from proportional chance, a
35.7 percentage point improvement. The
classification table shows that the classification
for low-performing SMEs is
the most accurate, with 74.5 percent of#p#分頁標(biāo)題#e#
cases being correctly assigned. Highperforming
SMEs are also well classified
with 67.9 percent of cases being correctly
assigned. High- and lowperforming
LOs are slightly less well
classified, with 42.9 and 54.3 percent
correct classification, respectively. As
such, P1 is supported—BMPs differentiate
between high- and low-performing
SMEs and LOs.
The final stage of analysis involved
specifically comparing the brand management
activities undertaken by high
versus low-performing SMEs. The sample
of SMEs was divided into two groups,
by way of a mean split on organization
performance. The split yielded 84
low-performing SMEs and 78 highperforming
SMEs. An independent
samples t-test was then used to compare
responses between the two groups along
each of the 10 BMP dimensions. As
can be seen from Table 5, significant
differences exist between high- and
BERTHON, EWING, AND NAPOLI 37
Table 4
Discriminant Analysis—Brand Management Practice (BMP)
Difference among High- and Low-Performing Small
to Medium-Sized Enterprises (SMEs) and Large
Organizations (Los)
Eigenvaluesa
Function Eigenvalue Percent of
Variance
Cumulative
Percent
Canonical
Correlation
1 0.449 57.1 57.1 0.557
2 0.299 38.0 95.1 0.480
3 0.039 4.9 100.0 0.194
Wilks’ Lambda
Test of Function(s) Wilks’ Lambda Chi-square df Sig.
1 through 3 0.512 170.929 30 0.000
2 through 3 0.741 76.407 18 0.000
3 0.963 9.733 8 0.284
Tests of Equality of Group Means and Structure Matrixb
Tests of Equality of
Group Means
Structure Matrix
Univariate F-Test Function 1 Function 2
Wilks’s Lambda F Sig. r b r b
BMP10 0.803 21.151 0.005 0.713c 0.887 0.260 -0.263
BMP5 0.804 21.008 0.000 0.607c 0.688 0.366 -0.075
BMP7 0.844 16.003 0.000 0.487c 0.810 0.361 0.067
BMP2 0.878 12.009 0.000 0.090 -0.345 0.759c 0.555
BMP9 0.880 11.788 0.000 0.241 -0.105 0.688c 0.351
BMP8 0.792 22.706 0.000 0.392 0.337 0.672c 0.558
BMP3 0.876 12.244 0.000 0.357 0.054 0.555c 0.343
BMP1 0.951 4.404 0.000 0.203 0.049 0.473c 0.275
BMP6 0.846 15.753 0.000 0.377 -0.093 0.444c 0.447
BMP4 0.893 10.377 0.000 0.344 -0.045 0.378c 0.295
38 JOURNAL OF SMALL BUSINESS MANAGEMENT
low-performing SMEs along 7 of the 10
BMPs. That is, higher-performing SMEs
place relatively more emphasis than lowperforming
SMEs on brand benefits
(BMP1), relevancy (BMP2), consistency
(BMP5), portfolio (BMP6), activities
(BMP7), meaning (BMP8) and support
(BMP9). These findings provide some
empirical evidence of the importance
and value of brand management to SMEs
and lend support to P2—that is, highperforming
SMEs implement BMPs to a#p#分頁標(biāo)題#e#
greater extent than their less successful
counterparts.
Discussion and
Implications
Over the years, marketing scholars
and practitioners have continued to
expand the domain of brand management
and describe the salient practices,
principles and philosophies that organizations
should adopt. Not surprisingly,
the focus has tended to be on the world’s
most successful brands. Managers of
large corporations, with significant marketing
budgets, therefore have an abundance
of information (albeit not all
empirical) to guide their branding
efforts. However, the question of how
smaller organizations, with modest
resources, can effectively manage their
brands has been hitherto completely
overlooked by researchers. This study
examined the nature and scope of brand
management in SMEs. Specifically, we
sought to first identify whether BMPs
employed by SMEs varies to that of LOs
Table 4
Continued
Classification Resultsd
Predicted Group Membership
Lowperforming
SMEs
Highperforming
SMEs
Lowperforming
LOs
Highperforming
LOs
Total
Count
(%)
Low-performing
SMEs
73 19 2 4 98
(74.5) (19.4) (2.0) (4.1) (100.0)
High-performing
SMEs
20 57 0 7 84
(23.8) (67.9) (0.0) (8.3) (100.0)
Low-performing
LOs
6 6 15 8 35
(17.1) (17.1) (42.9) (22.9) (100.0)
High-performing
LOs
10 11 0 25 46
(21.7) (23.9) (0.0) (54.3) (100.0)
aFirst three canonical discriminant functions were used in the analysis.
br = Pooled within-groups correlations between discriminating variables and
standardized canonical discriminant functions. Variables ordered by absolute size
of correlation within function. b = standardized canonical discriminant function
coefficients.
cLargest absolute correlation between each variable and any discriminant function.
d64.6 percent of original grouped cases correctly classified; 28.9 percent accuracy
expected from proportional chance model.
BERTHON, EWING, AND NAPOLI 39
and second, whether such differences
extend to high- and low-performing
SMEs.
The results indicate that there are certainly
differences between SMEs and LOs
in the extent to which they implement
key BMPs. It is evident from the results
that SMEs and LOs alike are both cognizant
of the need to deliver relevant and
desirable brands to customers. However,
the BMPs of LOs are certainly geared
more toward understanding and monitoring
consumer needs and measuring
the effectiveness of past actions.
It is also evident from the results that
the 10 BMP dimensions are effective in
discriminating between high- and lowperforming#p#分頁標(biāo)題#e#
small and large organizations.
More importantly, it seems that
high-performing SMEs implement key
BMPs to a greater extent than lowperforming
SMEs. Brand-focused SMEs
are able to achieve a distinct performance
advantage over rivals by essentially
getting back to the “branding
basics”: that is, understanding customers’
needs and brand perceptions, creating
relevant and valued brands, supporting
the brand consistently over time, effectively
communicating the brand’s identity
to internal and external stakeholders
and creating a coherent brand architecture.
Such activities are well noted in the
literature as necessary for building and
managing brand equity in the long term
(Keller 1999, 1998; Shocker, Srivastava,
and Ruekert 1994; Park, Jaworski, and
MacInnis 1986). In particular, this suggests
that there is the potential for SMEs
to optimize their performance by mirroring
and adapting the brand management
activities of their larger counterparts to
their specific needs and circumstances.
Ultimately, this should go some way
toward contributing to the ongoing performance
of organizations.
Limitations and
Directions for Future
Research
This study paves the way for delineating
the salient brand management
activities necessary for enhancing the
performance of both SMEs and LOs.
Several limitations of the study are to be
noted, however. First, the two subgroups
used in this study (that is, SMEs and LOs)
were unequal size, with the latter being
somewhat smaller than desirable.
Second, the study was based on Keller’s
(2000) BRC, which raises the question of
whether the BRC in fact fully captures
the nuances of branding in SMEs. Third,
the reliability of one of the BMP dimensions
is questionable.
There are several salient avenues for
future research in this area. First, the
field would benefit tremendously from a
grounded, interpretive study of SMEs
and how they view their key intangible
(marketing) asset. Such an approach
might take the form of multiple case
studies or depth interviews and could
Figure 1
Plot of Group Centroids for
High- and Low-Performing
Small to Medium-Sized
Enterprises and Larger
Organizations by
Discriminant Functions
-2 -1 0 1 2
2
0
-2
High Performing
LCs
Low Performing
LCs
High Performing
SMEs
Low Performing
SMEs
Function 1
Function 2 40 JOURNAL OF SMALL BUSINESS MANAGEMENT
focus in detail on issues surrounding
what, how, and why. The same (or a
subsequent) study should also address
issue surrounding the definition of a
brand to a typical SME, and if and#p#分頁標(biāo)題#e#
how “corporate reputation,” “corporate
brand,” and “product-level brand” differ.
A second and highly related line of
inquiry could focus on SME stakeholders’
perceptions of SME “brands.” One alternative
here would be to adapt and
administer Yoo and Donthu’s (2001)
consumer-based brand equity scale to
various stakeholder groups. However,
Table 5
Comparison of Brand Management Practices (BMPs)
between High- and Low-Performing Small to
Medium-Sized Enterprises
Dimension Performance N Mean S.D. Sig.
BMP1 Brand delivers benefits
customers truly desire
Low 84 4.93 1.16 0.02
High 78 5.32 0.87
162 5.13
BMP2 Brand stays relevant Low 84 5.28 1.08 0.00
High 78 5.75 0.66
162 5.52
BMP3 Pricing strategies based on
perceptions of value
Low 84 3.60 1.36 0.20
High 78 3.90 1.60
162 3.75
BMP4 Brand is properly
positioned
Low 84 4.48 1.28 0.06
High 78 4.85 1.23
162 4.66
BMP5 Brand is consistent Low 84 4.42 1.36 0.00
High 78 5.09 1.18
162 4.76
BMP6 Brand portfolio and
hierarchy make sense
Low 84 4.27 1.15 0.00
High 78 4.97 1.17
162 4.62
BMP7 Brand uses full repertoire
of marketing activities to
build equity
Low 84 4.37 1.38 0.00
High 78 5.08 1.14
162 4.73
BMP8 Brand managers
understand what the
brand means to
consumers
Low 84 3.66 1.19 0.00
High 78 4.28 1.23
162 3.97
BMP9 Brand is given proper
support and it is
sustained over the long
run
Low 84 3.75 1.17 0.00
High 78 4.53 1.30
162 4.14
BMP10 Company monitors sources
of brand equity
Low 84 3.20 1.34 0.15
High 78 3.53 1.52
162 3.37
BERTHON, EWING, AND NAPOLI 41
other more generative approaches could
work just as well. A third direction might
entail the development of a psychometrically
robust measure of brand management
within SMEs (in other words, a
more deductive approach than that followed
in this paper). This could assist
practitioners in benchmarking their
activities against rival organizations and
understanding the effectiveness of their
branding activities. From an academic
perspective, such a scale would provide
a mechanism by which to explore relationships
and associations with other
constructs. Fourth, research could be
directly toward identifying and understanding
the key antecedents to and consequences
of an SME’s BMPs. For
instance, what are the key drivers of the
BMPs pursued by an organization? What
impact does organizational culture have
on an organization’s BMPs or vice versa?
What are the outcomes of adopting effective#p#分頁標(biāo)題#e#
BMPs and does it lead to measurable
improvements in organizational performance,
customer satisfaction or commitment?
Alternatively, which BMPs lead to
increased brand equity? These are some
of the questions that future researchers
could address. Finally, it may be useful to
identify how the BMPs of SMEs differ
across cultures and whether this leads to
desirable performance outcomes.
In sum, this is an underresearched
area. The present study provides an
empirically based “springboard” for
future research. Hopefully, others will
take up the challenge.
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