Raluca Descotes Mogos* Maître de conférences HDR Université de Lorraine, CEREFIGE

Transcription

1 CONSUMERS RESISTANCE TO A RETAILER BRAND NAME SUBSTITUTION: ANTECEDENTS AND CONSEQUENCES. Raluca Descotes Mogos* Maître de conférences HDR Université de Lorraine, CEREFIGE raluca.mogos-descotes@univ-lorraine.fr Véronique Pauwels Delassus Professeur associé IÉSEG School of Management, LEM-CNRS v.pauwels@ieseg.fr Joseph Kaswengi Maître de conférences Université d Orléans, VALOREM joseph.kaswengi@univ-orleans.fr * Raluca Mogos Descotes IUT Charlemagne, Université de Lorraine, 2ter Boulevard Charlemagne, Nancy raluca.mogos-descotes@univ-lorraine.fr Téléphone : Abstract This article analyses the managerial levers of action that alleviate consumers resistance to a retailer brand name change, their consequences upon the brand equity of the substitution brand, and umbrella brand equity. Both, qualitative and quantitative research approaches were used and suggest that in order to reinforce the brand equity of the substitution retailer brand compared to the substitution brand as well as the substitution retailer umbrella brand equity, managers should extensively involve consumers within the brand name substitution process and inform them as much as possible regarding the benefits of the change. Overall, they should more extensively use those latter two managerial levers of action for the consumers that are characterized by lower levels of involvement with store shopping. Key words: brand name substitution, retailer brand equity, resistance to change, involvement with store shopping RESISTANCE DES CONSOMMATEURS AU CHANGEMENT DE NOM DU DISTRIBUTEUR : ANTECEDENTS ET CONSEQUENCES. Résumé L article analyse les leviers que les managers peuvent utiliser afin de diminuer la résistance au changement de nom des distributeurs et les conséquences que peuvent avoir la résistance sur le capital de la marque de substitution et de la marque ombrelle. Les études qualitatives et quantitatives réalisées suggèrent que pour renforcer le capital de la marque de substitution et celle de la marque ombrelle de l enseigne, managers devraient fortement impliquer les consommateurs dans le processus de changement de marque et les informer le mieux possible sur les bénéfices du changement. D une manière générale, ils devraient davantage utiliser ces deux derniers leviers d actions envers les consommateurs qui sont notamment faiblement impliqués dans les achats en magasins. Mots clés : changement de nom de marque, capital de marque des distributeurs, résistance au changement, implication dans les achats en magasins. 1

2 Introduction Although brand name substitution/change, which consists within the replacement of an old/substituted brand with another new/substitution brand (Cegarra, 1994), is a widely developed phenomenon, little academic research focuses on this topic (Laï, 2006). Some studies analyse brand image transfer from the old towards the new brand (Pauwels-Delassus and Fosse, 2012), raise typologies of brand substitutions (Aimé Granier and Laï, 2008), or tempt to identify factors of acceptance of brand name substitutions (Collange, 2008). Indeed, brand name substitution has become nowadays a common managerial practice. For instance, within the retailing sector in France, over these last years, the multinational group Carrefour undertakes a massive carrefourisation of its retailer brand names (e.g.: Proxi - Carrefour Express, Shopi - Carrefour Contact or Carrefour City, Champion - Carrefour Market). Those brand name changes aim to modernize the former retailer brands, to reinforce consumers relationship with the umbrella brand Carrefour, and also to reduce communication expenses, now exclusively directed towards the umbrella brand Carrefour. If the reinforcement of the substitution brand equity appear as almost natural concerns for marketing managers (Kapferer, 2007), only one previous study addresses this question. Pauwels-Delassus and Mogos-Descotes (2013) underline which are the main determinants potentially enhancing the brand equity transfer. However, it is important to stress that not all brand substitutions aim to transfer brand equity from the old to the new brand. They sometimes might aim to modify/rejuvenate the brand. Regardless of the aim of brand substitutions, confronted with brand name change, consumers develop resistance to change (Kapferer, 2007). In the case of brand name substitutions, the main problem encountered by consumers is the loss of their past references to the brand (Kapferer, 2007), creating confusion and resistance to the brand name change (RTBNC). For instance, in the case of the brand substitutions undertaken by Carrefour starting with 2008 (e.g. Shopi Carrefour Contact or City, Champion-Carrefour Market), the former retailer brands and supermarkets were radically modified. Not only had the brand name change, but also the brand colours and symbols. Moreover, the layout of the shelves within the supermarkets changed as well. For these reasons, one can expect that consumers were in a first stance confused; they had to adapt their habits, and completely give up their past references to the substituted brand. We therefore, expect they might develop RTBNC, and their negative attitudes towards the change might have important consequences upon brand equity. Resistance to change was broadly defined as consumers likelihood to oppose themselves to a change (Roux, 2007). Brand substitutions disturb not only brand recognition, but also consumers habits, judgements and perceptions regarding brand associations, product quality. They represent often a highly risky practice. For example, after the acquisition of the retailer chains Spar and Wertkauf in Germany, Wal-Mart decides to implement the Wal- Mart s proven US success formula everyday low prices and renames all those stores Wal- Mart. This decision is rapidly followed by resistance to the brand name change on the employers and consumers side, highly hostile to the modifications. As a result, Wal-Mart had to exit the German Market. Therefore, for managers confronted to brand name change, it is of upmost importance to make sure they can minimize consumers resistance to change in order to diminish the negative consequences of brand substitutions, and thus preserve both brand equity and umbrella brand equity (in certain cases of brand substitutions involving umbrella brands). To the best of our knowledge, no previous study addresses the question of brand substitutions consequences upon the overall brand equity of the substitution brand, and umbrella brand equity, which as mentioned before are at the heart of the managerial concerns when undertaking brand substitutions. 1

3 Theoretical background and research hypotheses Drawing on the resistance to change theory, Giangreco and Peccei (2005) indicate that the perceived benefit of the change will minimize the resistance to change. Pauwels-Delassus et al. (2014), suggest that in order to diminish RTBNC, managers should do their best to involve consumers within the brand substitution process, explain them carefully which are the benefits of the brand substitution and pay attention to the level of consumers attachment to the old brand. However, managers cannot thoroughly influence consumers degree of attachment towards the initial brand (Mogos Descotes and Pauwels-Delassus, 2015). Still, they can develop their perceived degree of involvement within the brand substitution process (e.g. by extensively informing consumers regarding the brand substitution, before and after the brand name substitution, or by asking their opinion regarding the intended brand modifications). Moreover, they can extensively communicate regarding the benefits of the brand substitution in order to make sure consumers become aware of them. To sum up, it is of upmost importance that brand managers consider seriously the two managerial levers they can manipulate in order to diminish consumers resistance to the brand name change process, namely the reinforcement of consumers degree of involvement within the change process and their perception of the benefits of the change. For these reason, it is proposed that: H1: Consumers levels of perceived involvement within the brand substitution process lowers their degree of RTBNC. H2: The perceived benefits of the brand name substitution lower consumers degree of RTBNC. Brand equity may be seen as a multidimensional concept, composed by brand loyalty, brand awareness, perceived quality, brand associations and other assets (Aaker 1991, 1996). Yoo, Donthu and Lee (2000) define overall brand equity (at the broad and aggregate level and not through its dimensions) as the incremental utility or value added to a product by its brand name, engendering a preferential response from consumers. The authors stress that it is of key importance to study brand equity not only through its dimensions (brand associations, image and loyalty) but at the aggregate/broad level in order to capture consumers preference towards the brand. According to Yoo, Donthu and Lee (2000), the broad/overall brand equity seen as preference for the focal brand is the ultimate source of competitive advantage, delivering long term value for the firm and for consumers. Within the brand name change literature, it has been shown that consumers positive attitudes towards the brand substitution favours the reinforcement of two elements of brand equity, namely brand image and brand association/awareness, of the new replacement brand (Pauwels-Delassus and Mogos-Descotes, 2012). Since retailer brand image and brand association/awareness define and determine the broad/overall brand equity (Yoo, Donthu and Lee, 2000), it is expected that RTBNC will have the opposite, negative impact on brand equity progression between the old and the new brand: H3: Consumers degree of RTBNC has a negative impact upon the progression of brand equity from the old to the new brand. Pauwels-Delassus et al. (2014) conclude that sometimes brand name substitution aim besides the development of the brand equity of the new replacement brand, to also reinforce the brand equity of the umbrella brand. They interviewed 10 managers of Carrefour Market, who suggested that the aim of the replacement of the old brand Champion by Carrefour 2

4 Market was not only brand rejuvenation, but also the reinforcement of the popular retailer brand Carrefour (the umbrella) brand. According to the results of the qualitative research undertaken by Pauwels-Delassus et al. (2014), if consumers RTBNC seems to have a negative impact upon the umbrella brand of the substitution brand, the reinforcement of the substitution brand enhances the umbrella brand equity: H4: Consumers degree of RTBNC has a negative impact upon the brand equity of the substitution brand s umbrella brand. H5: The progression of the brand equity from the old to the new brand has a positive impact upon the brand equity of the substitution brand s umbrella brand. Methodology The causal nature of our research question suggested a quantitative methodology. Nevertheless, to better understand how consumers perceive the differences in terms of brand equity between the old and the new brand, how they develop RTBNC, and which factors influence it, we conducted a preliminary qualitative study with a sample of 18 consumers of different ages and occupations. Furthermore, using a pre-tested face-to-face questionnaire, a final sample of 498 consumers was asked to indicate in the first part of the questionnaire (1) their perception of the (overall) brand equity of the substituted retailer brand Shopi. Afterwards, in the second part of the questionnaire, consumers were asked (2) whether they felt involved within the brand substitution process, (3) to which extent they perceived benefits as a results of the brand substitution, and (4) their degree of RTBNC. Finally, in a third part of the questionnaire, they were asked to indicate (5) their perception of the overall brand equity of the new (replacement) brand Carrefour Contact as well as (6) their perception regarding the brand equity of the umbrella brand Carrefour. Finally, in the end of the questionnaire, some general questions concerning their socio-cultural characteristics were asked. The transfer of brand equity from the old to the new brand was measured as the Euclidian distance between the measures for Shopi and Carrefour Contact. The measures used to capture the main concepts of interest for our research are resumed in Table 1. A retailer brand name substitution that occurred on the French retailing market was selected for this research, namely the substitution of Shopi with Carrefour Contact in Nancy in According to Jean Marie L Homé, Aurel BGC business analyst, the very first positive effects of the brand name substitutions undertaken massively by Carrefour between , should be observable only starting with 2013 (Bruckmüller, 2012). Indeed, it takes time to reinforce a retailer umbrella brand equity as consumers need to be in a first phase extensively informed about the brand name substitutions (Bruckmüller, 2012). Furthermore, confronted several times with the new retailer brands they might end up understanding the perceived benefits of the new compared to the old substitution brand. We gathered our data in April 2014 in order to make sure that we can extensively capture the constructs of interest in our research. This retailer brand substitution can be judged as rather radical. The brand name substitution was accompanied by a radical change in the dominant colours of the retailer brands (blue and red for Shopi and green and grey for Carrefour Contact). The tagline changed, and also the store layout changed once with the change. Therefore, this brand name substitution is particularly interesting in terms of our study, in that it was likely to cause resistance to change. 3

5 Table 1. Overview of the measurement scales used Construct Measurement scale Reference Brand equity 4 items Donthu and Yoo (2000) Consumers resistance to brand name 4 items Mogos Descotes and change Pauwels-Delassus (2015) Involvement within the brand change process 3 items Issued from the qualitative research Perceived benefits of the brand change 2 items Issued from the qualitative research Note: All the items were measured on a 7 point Likert scale ranging from 1 = completely disagree to 7 = completely agree Results In order to assess measurement scales psychometric properties, first, exploratory factor analysis was conducted. Second, Cronbach s alpha was calculated to evaluate the reliability of all latent constructs, retaining the cut-off value of.70 in line with Nunnally and Bernstein (1994). Consequently, one of the consumers RTBC items was removed since it lowered the construct reliability. The factors retrieved from the exploratory factor analysis were supported by the confirmatory factor analysis, which rigorously assess the psychometrical properties of the latent constructs, based on the correlation matrix of their respective items. The standardized loading values ranged from.65 to.95 (t values: to ), demonstrating adequate convergent validity (p <.001). The measurement model fit can be judged as satisfying: chi2= , p=.000; RMSEA=.047; SRMR=.037; CFI=.981; TLI=.974. The convergent validity of the measurement model was examined by calculating average variance extracted (AVE) (Fornell and Larcker, 1981). In all cases, the AVE of each measure extracted is superior to 50% of the variance in line with Bagozzi and Yi (1988). Thus, the convergent validity of the measurement model appears to be adequate. The discriminant validity of the measures was examined by comparing the AVE with the square correlations (SC) among latent variables (Fornell and Larcker, 1981). The AVE values were greater or equal to the square correlations. Consequently, the discriminant validity conditions are also respected. Furthermore, the structural equation modelling was used to test the research hypotheses. Table 2 report the standardized solution which arises from the maximumlikelihood method. The goodness of fit test, examining the suitability of theoretical to the observed matrix of observations, can be considered as satisfying as well for estimating both the main effects on the whole sample, and the moderating effects (see Table 2). Table 2. Structural Model Estimates (n = 498) Hypothesis Coef. p-value Conclusion H1 : Perceived involvement -> RTBNC p <.001 Supported H2: Perceived benefits -> RTBNC p <.001 Supported H3: Consumers RTBNC -> BE old to new p <.001 Supported H4: Consumers RTBNC -> umbrella brand BE p <.001 Supported H5: BE old to new -> umbrella brand BE.504 p <.001 Supported Model fit indices 4

6 χ² = (p =.483), RMSEA =.000, SRMR=.010, CFI= As expected, consumers levels of perceived involvement (-.179, p <.001) and the perceived benefits (-.600, p <.001) are two powerful predictors of RNTBC. Thus, H1 and H2 are supported. The effects of RNTBC on the progression of brand equity from the old to the new brand (-0.275, p <.001) and the brand equity of the substitution brand (-.460, p <.001) are also significant. Therefore, H3 and H4 are supported. In addition, H5 is also supported since the progression of the brand equity from the old to the new brand positively (.504, p <.001) impacts the brand equity of the substitution brand s umbrella brand. To sum up, the results reported in Table 2, allow us to validate the research hypotheses 1, 2, 3, 4 and 5. Major findings and implications To recapitulate, our study is the first study aimed at assessing the main managerial levers, as well as their relative importance for the reduction of consumers RTBNC. It is also the first study that assessed the progression of the brand equity at the aggregate level from a substituted towards a substitution brand, as well as the impact of this progression and of the consumers RTBNC upon the substituted brand related umbrella brand. Our research has important managerial, methodological and theoretical implications. On the managerial front, our results suggest that in order to reinforce the brand equity of the substitution brand and its umbrella brand, marketing managers should try to do their best in order to minimize consumers RTBNC. We can suggest that marketing managers should, in the case of retailer brand substitutions, (1) extensively inform and explain to the consumers the benefits of the change (e.g.: brand new supermarket, increased price promotion, availability of more private labels, etc.) and (2) involve consumers within the brand substitution process (e.g.: inform consumers about the change before and after, ask for their opinion, etc.). Those two aforementioned managerial levers of action diminish consumers RTBNC. On the theoretical front, this research allows us to conclude that overall, the resistance to change theory is highly appropriate in order to understand brand equity change phenomenon and to also understand consumers RTBNC. We were also able, on the theoretical front, to initiate the understanding of the progression of brand equity at the aggregate level and its consequences on the related umbrella brand. However, the obtained results apply to the brand substitution case selected, namely Shopi- Carrefour Contact. We also acknowledge the interest to develop furthermore a longitudinal study design in order to capture the evolution over time of the brand equity perceptions, of the RTBNC, as well as the understanding of the perceived benefits of change. Another point is that we only took into consideration within our study the managerial levers of actions aimed at diminishing resistance to a brand name substitution. We did not consider more affect-based constructs, such as brand attachment, which has a strong impact on diminishing consumers resistance to brand name change (Mogos-Descotes and Pauwels-Delassus, 2015). The main reason for doing so is there s relatively little managers can do to diminish consumers affective attitudes, such for instance their nostalgia regarding the old brand. Further research may be directed in order to address those aforementioned limits of our research. References available upon request. 5