EXPLORING BRANDING STRATEGIES OF DURABLES, SERVICES AND FMCG BRANDS

Transcription

1 CHAPTER 4 EXPLORING BRANDING STRATEGIES OF DURABLES, SERVICES AND FMCG BRANDS There are various types of branding strategies from which a company can select a suitable branding strategy for a product/service. Previous research puts forward that neither type of branding strategy is better than the other; rather suitability of the branding strategy depends upon the matching of the branding strategy with the characteristics of the offering. This suggests that different branding strategies would be suitable for the three sectors, that is, durables, services and FMCG as the three sectors differ from each other in their characteristics. Literature survey also suggests that previous studies provide ambivalent results on the appropriateness of different branding strategies for the three sectors. In order to contribute to the closing of this research gap, the current chapter content analyzes the branding strategies used in the three sectors namely, durables, services and FMCG 1) to explore the usage of various types of branding strategies in the three sectors in India, and 2) to investigate the differences, if any, in the usage of different branding strategies across the three sectors. The end results of this chapter would help us to know how brand managers actually practice different branding strategies in the three sectors. Further, the first step towards researching different branding strategies is the identification of the entire range of branding strategies. But there is conflict and confusion in the existing literature on classification of branding strategies. Therefore, before proceeding to the content analysis of branding strategies in the three sectors, an overview of the relevant literature on the classification of branding strategies is presented, culminating in re-classification of branding strategies which is subsequently used for analyzing the branding strategies of the three sectors. IDENTIFYING BRANDING STRATEGIES Past literature suggests several taxonomies for classifying branding strategies as shown in Table 4.1.

2 Table 4.1 Classification of ing Strategies Given by Various Authors Gray and Smeltzer (1985) Single Entity Dominance Equal Dominance Mixed Dominance Corporate Dominance Murphy (1987) Corporate Dominant Systems Dominant Systems Balanced Systems Mixed Systems Olins (1989) Monolithic Strategy Endorsed Strategy ed Strategy Laforet and Saunders (1994) Corporate Dominant Strategy Mixed Strategy Dominant Strategy Aaker and Joachimsthaler (2) ed House Strategy Sub-ing Strategy House of s Strategy Berens et al. (22) Corporate ing Strategy Sub-ing Strategy Stand Alone Strategy Rajagopal and Sanchez (24) House of s Strategy Endorsement Strategy ed House Strategy Strebinger (24) Corporate ing Strategy Target ing Strategy Product ing Strategy Product and Target ing Strategy Family Strategy Laforet and Saunders (25) Corporate ed Strategy Endorsed Strategy Dual Strategy Multi-ed Strategy ed Strategy Keller (28) Company/Corporate Family Individual Modifier Muzellec and Lambkin (29) Corporate as Trade brand Corporate as Business Corporate as Holistic Rahman and Areni (29) Inter-organisational Architecture Network s Support s Co-s Intra-organisational Architecture ed Division ed Features ed Programs Keller (28) proposes four hierarchical types of a brand Corporate/Company brand (conglomerate or company or subsidiary name), Family brand (brand used in more than one product category), Individual brand (brand restricted to one product category only) and Modifier (a means to signal refinement or differences in brands). This classification is from the individual product/service perspective. Other researchers have defined 84

3 branding strategies at the company level by taking the entire portfolio of brands of the company as a unit of analysis which is discussed further. Corporate-dominant strategy is defined as the strategy in which only corporate brand name is used in all communications of the company (Gray and Smeltzer, 1985; Murphy, 1987; Laforet and Saunders, 1994, 25). Olins (1989) has given it the name of Monolithic strategy whereas Aaker and Joachimsthaler (2), and Rajagopal and Sanchez (24) name it ed house strategy while Berens et al. (22) call it Corporate branding strategy. Here, corporate brand symbolizes conglomerate name, company name and house/subsidiary name (Loforet and Saunders, 1994, 25; Keller, 28). Gray and Smeltzer (1985) also state that when a company, essentially operating in only one product line, uses its company brand only, it is called Single entity branding strategy. In -dominant strategy, different brand names, that are different from corporate brand, are used for different products/services of the company (Gray and Smeltzer, 1985; Murphy, 1987; Laforet and Saunders, 1994, 25). Olins (1989) has given this strategy the name of ed strategy whereas Aaker and Joachimsthaler (2), and Rajagopal and Sanchez (24) name it House of brands strategy while Berens et al. (22) call it Stand-alone strategy. Laforet and Saunders (1994) classify this strategy into two categories: first, Mono branding when corporate identity is disclosed and second, Furtive branding when corporate identity is not disclosed. Mixed branding strategy is the strategy in which two brand names, that is corporate and individual product brand names, are used together with varying visibilities for branding products/services (Gray and Smeltzer, 1985; Murphy, 1987; Loforet and Saunders, 1994). Olins (1989) has named it Endorsed strategy whereas Aaker and Joachimsthaler (2) and Berens et al. (22) name it Sub-branding strategy while Rajagopal and Sanchez (24) call it endorsement strategy. Aaker and Joachimsthaler (2) divide this strategy into three categories: First, Master brand as driver strategy when corporate brand is more prominently visible. Second, Sub-brand as co-driver strategy when two brands are given equal visibility prominence. Gray and Smeltzer (1985) name it Equal dominance strategy while Murphy (1987) names it Balanced strategy whereas Loforet 85

4 and Saunders (1994) name it Dual branding strategy. Third, Endorsement strategy when corporate brand receives less emphasis than product brand. Endorsement strategy has further been classified as Strong endorsement, Linked name and Token endorsement. Laforet and Saunders (25) argue that companies can also use more than two brands together for a product/service, and call it Multi-branded strategy. Strebinger (24) has defined branding strategies based on the number of product categories and target groups a branding strategy serves. He proposes five types of branding strategies: First, Corporate branding strategy that adopts a uniform brand for all product categories and target groups. Second, Target group branding strategy where a company uses a different brand name for each target segment. Third, Product branding strategy in which a different brand name is used for each product category. Fourth, Product and Target specific branding strategy where there is a different brand for each combination of target group and product category. Fifth, family strategy in which hierarchically ranked brands have a common endorser. Muzellec and Lambkin (29) give threefold classification of the corporate brand. First, Trade brand which means that corporate brand is not actively promoted, but acts as a simple umbrella name housing a collection of independent brands. Second, Business brand which means corporate brand is not actively visible to consumers on the package of the product, but is a strong name for particular stakeholders because of specific branding programs run by the company. Third, Holistic brand which means corporation and products share the common name. Rahman and Areni (29) develop Services Relationship Matrix to understand brand architecture in services. They propose that in addition to branding the company, service companies can brand subsidiaries, divisions, features and benefits, and supplementary service programs. Service companies can also benefit by creating interorganisational brands that can take the form of network brands, support brands or cobrands. A review of the above listed studies suggests that there is confusion in the existing literature on classification of branding strategies. ing strategies have been given 86

5 different names by different authors and none appears exhaustive. So, there is a dire need to resolve this conflict in branding strategies classification. Further, various authors have defined branding strategies at the company level by analyzing the entire portfolio of brands of the company. They have not scrutinized the branding strategies from individual product/service perspective. However, contemporary branding strategies suggest that companies are not using a single standardised branding strategy for their entire portfolio; rather they are using different branding strategies for different brands in the portfolio. So, there is a need to study branding strategies from individual product/service perspective. These observations reinforce the need for building a simplistic list of branding strategies at the individual product/service level. DERIVATION OF CLASSIFICATION OF BRANDING STRATEGIES The literature review discussed above suggests that brands used can be classified into five types namely group brand, company brand, house brand, family brand and individual brand, where group brand is the highest in hierarchy. Group brand is defined as the conglomerate name which is used in branding products/services. For example, conglomerates like Reliance, Tata etc. use their conglomerate names for branding various products/services. Company brand is the company name which is used in branding products/services. For example, Essel Group has Zee Entertainment Enterprises Ltd., whose various channels are named as Zee, which is a company brand. House brand is e which is used in branding products/services. For instance, Gillette, a subsidiary of Procter & Gamble (P&G), is used to brand various products. Family brand is a brand name which is not a company or a group name and is used in more than one product/service categories, such as Maggi brand owned by Nestle is used for a number of product categories such as noodles, sauces, soups, coconut milk powder etc. Individual brand is a brand name, other than company or group name, which is restricted to essentially one product category such as Ariel detergent by P&G. For the purpose of this research, taking cue from Keller (28), group and company brand types are clubbed together under single category called corporate brand. Hence, we have identified four brand types namely corporate, house, family and individual brand types. 87

6 A company can choose either one or two or sometimes even more than two of these brand types while branding a product/service. If a single brand type is chosen, obviously, it would be the only visible brand type for the product/service. When multiple brand types are chosen, each brand type can vary in its relative visibility as compared to other brand types. The different possible visibility styles for a brand type along with their meanings are given in Table 4.2. Table 4.2 Classification of ing Strategies: Description of the Visibility Styles of a Type No. of Types Used Visibility Style Meaning Examples Single Type Combination of Multiple Types The Only Visible Type Prominently Visible Balanced Endorsement Linked Name Token Endorsement The single brand type is used which is the only brand type visible on the product/ service. The brand type is more prominently visible than other brand type(s) and is the primary frame of reference. The brand type is equally prominent as other brand type(s). The brand type is inferior in size than other brand type(s) and is secondary. When brand type has some common element with the other brand type(s) and acts as implied endorser. The brand type is prominently less visible than other brand type(s). HDFC Bank is single corporate brand. Yardley, Ariel, Pantene etc are single individual brands. Gillette is single house brand. Olay is single family brand. Zee Next uses corporate brand (Zee) with prominent visibility. In Mom & Me retail stores by Mahindra, individual brand Mom & Me is prominently visible. Dabur Honitus uses corporate and individual brand types with equal visibility. Cadbury Bournvita uses corporate brand Cadbury as an endorsement. Eduignite (Individual brand type) by Educomp (Corporate brand company name acts as linked name as it links two names Eduignite and Educomp. Lux (Family brand type) by HUL (Corporate brand type) uses HUL as token endorser. 88

7 The relationship of different visibility styles and the four brand types leads to multiple combinations and hence multiple types of branding strategies are available to companies. When single brand type is used, the branding strategy is the one of single corporate brand strategy, single house brand strategy, single family brand strategy or single individual brand strategy. When multiple brand types are used together, various possible combinations of the four brand types and five visibility styles result into various branding strategies. Thus, based on the four brand types, we have identified various branding strategies which differ in terms of the extent of visibility of the four brand types. This simplistic classification of branding strategies adds value to the literature by resolving the confusion existing in the literature. Further, this original classification would offer pertinent marketing intelligence to brand managers that will help them in designing more effective branding strategies. CONCEPTUAL FRAMEWORK AND RESEARCH HYPOTHESES The very nature of the three sectors indicates that the branding strategies used to communicate with consumers would be different, that is, the three sectors would differ in the usage and the extent of visibility of the four brand types. The following discussion presents the varying usage and visibility of the four brand types across the three sectors. From the discussion, four hypotheses concerning corporate, house, family and individual brand types are developed. Gurhan-Canli and Batra (24) argue that if the risk associated is higher, corporate associations are more important in consumer evaluations. While there is necessarily some degree of risk which accompanies all purchases, it is advocated that more risk is associated with services than goods (Zeithaml, 1981; Mitra et al., 1999). Therefore, it is suggested that services should be corporate branded and should not be individualised ry, 2; McDonald et al., 21; Burt and Sparks, 22). Hem et al. (23) argue that durables are also associated with high level of risk due to the possibility of the expected financial loss 89

8 being substantial. Consumers may also lack the technical knowledge necessary to assess quality of most of the durables, which may further increase risk. Thus, corporate brand type is also expected to be a preferred brand type for durables. Furthermore, according to Berens et al. (25), corporate associations have a stronger influence on consumers when consumer involvement is high. Due to high risk, there is higher consumer involvement in purchasing services and durables. This again reinforces the importance of corporate brand type for services and durables. FMCG sector is characterised by low involvement and low risk due to low purchase transaction amount and high frequency of purchase (East, 1997; Kotler, 2). Therefore, FMCG companies do not prefer corporate branding. Based on the above discussion, we propose the following hypothesis: H 1 : Visibility of the corporate brand type differs across the three sectors namely durables, services and FMCG. This should be more in the durables and services sectors than in the FMCG sector. Based on the above stated discussion, it can be expected that individual brand type is not suitable for durables and services, but is more suitable brand type for FMCG companies. Keller (28) also asserts that FMCG companies find it difficult to create a meaningful corporate brand around heterogeneous collection of products and resort to individual branding. Further, individual brand type is also preferred in the FMCG sector as it allows accurate positioning in the highly segmented and competitive FMCG markets (Laforet and Saunders, 1999; Aaker and Joachimsthaler, 2; Pierce and Mouskanas, 22; Vijayraghavan, 23; Rajagopal and Sanchez, 24). Hence, we postulate the following hypothesis: H 2 : Visibility of the individual brand type differs across the three sectors namely durables, services and FMCG. This should be more in the FMCG sector than in the durables and services sectors. Family brand type is used to link common associations to multiple but distinct products. It is similar to corporate brand type as both brand types are applied across a 9

9 range of product categories. However, these are different because family brand name is distinct from corporate brand name (Keller, 28). As durables and services sectors are associated with high risk, corporate associations are more important for these two sectors and hence corporate brand is used instead of family brand across a range of offerings. Turley and Moore (1995) also argue that family brand type is not relevant for services sector. As FMCG sector includes less risky purchases, family brand type is used here to create salience among similar product categories. Hence, we hypothesize: H 3 : Visibility of the family brand type differs across the three sectors namely durables, services and FMCG. This should be more in the FMCG sector than in the durables and services sectors. Laforet and Saunders (1994) advocate that house brand type is essentially used for two reasons: first, when a diversified company has divisions in tightly defined markets, and second, when acquisitions are made and the subsidiary is given some independence. The three sectors cannot be distinguished based on these two reasons. We could not find any theoretical reason as to why durables, services and FMCG sectors should differ when it comes to the usage of house brand type. Hence, we anticipate that the visibility of house brand type would be similar in the three sectors. Therefore, we posit the following hypothesis: H 4 : Visibility of the house brand type is same in the three sectors namely durables, services and FMCG. To carry out the objectives of this chapter, a content analysis of 6 randomly selected brands, 2 from each sector, was performed. The unit of measurement for content analysis was a product or service brand. For durables and FMCG, packaging or the product itself was content analysed by visiting various retail outlets whereas for services, websites of the services brands were content analyzed. Unlike goods, services do not have any packaging or tangible form that can be analyzed and therefore alternative source had to be selected. A pre-test of various sources of 91

10 communication of 25 service brands (8 Banks, 3 Insurance, 7 Retail, 3 Telecom and 4 Hotels) was conducted to find the most appropriate source revealing the branding strategy. The sources of communication content analyzed in pre-testing included websites and advertisements plus two other sources depending upon the type of service (Banks ATM Card, Pass book; Insurance products Insurance policy, Instalment slip; Retail Display outside the store, Loyalty card; Telecom SIM card cum connection details packet, Post-paid Bill or Pre-paid recharge coupon as the case may be; Hotels Menu, Bill). For each service brand, the branding strategy was found to be the same regardless of the source of communication meaning thereby that the companies were resorting to IMC (Integrated Marketing Communications) which is defined by Clow and Baack (27) as the communication strategy in which a company creates harmony in transmitting messages to its stakeholders through different mediums. Since consistency was found in the various sources, any communication source indicating branding strategy was found to be suitable for content analysis. Websites were selected as a source of information for content analysis of services brands for the purpose of homogeneity as most of the services brands were found to have exclusive websites. However, websites were not found to be appropriate for analyzing branding strategies of tangible goods as there are very few such brands having separate websites. In order to know the branding strategies used in the three sectors, sampled brands were examined. Based on the different visibility styles of brand types given in Table 4.2, a coding sheet (Table 4.3) was prepared for the purpose of content analysis. The researcher herself, the Ph.D. supervisor of the researcher and one independent researcher served as coders. First, basic details relating to company name, brand name and sector were noted for each brand. Following this, the brand types used were identified and their visibility styles were noted. The allocation of brand types to different visibility styles was judgemental, taking into account all the factors that affect the relative prominence of the brand such as its relative size, boldness, colour and position (Laforet and Saunders, 1994, 25 and 27; Keller 28). 92

11 Table 4.3 The Coding Sheet for Measuring ing Strategies S. No. Company Name Name Sector Durables/Services/FMCG Type Visibility Style Score The Only Type 9 Prominently Visible 8 Balanced 7 Strong Endorser 6 Weak Endorser 5 Linked Name 4 Token Endorser 3 Only Disclosed 2 Not Disclosed 1 Corporate Type House Type Family Type Individual Type Next, for every sampled package and website as the case may be, each brand type was given a visibility score on the scale ranging from 1 to 9, 9 for being the only brand type, 8 for being prominently visible, 7 for balanced type, 6 for strong endorsement, 5 for weak endorsement, 4 for linked name, 3 if used as token endorser, 2 if only disclosed and 1 for absence of the brand type. The three sectors are statistically compared based on the visibility scores of the four brand types. Mean and standard deviation (SD) of visibility scores of each brand type are calculated for the three sectors. Multivariate Analysis of Variance (MANOVA) has been performed to test the assumptions of MANOVA. Further, multivariate and univariate effects are examined to investigate whether the differences in visibility of the four brand types across the for pair wise comparison of the three sectors to determine the differences in the branding strategies of the sectors. 93

12 DATA ANALYSIS AND RESULTS The results are presented in two parts: first part reports the various types of branding strategies used in the three sectors and has been sub- Hypotheses Testi ing Strategies Used in the Three Sectors Table 4.4 reports the various types of branding strategies used in durables, services and FMCG sectors based on the frequency of usage of the four brand types in a sector with different visibility styles. Analysis from Table 4.4 relating to the durables sector reveals that single corporate brand type is the most dominating branding strategy in this sector (82.6%). It is used in combination with other brand types in 17.4% of the cases, either with balanced visibility (87.9%) or as an endorser (12.1%). Individual brand type is used in 19.5% of the cases, most often in combination with other brand types (87.2%). It is used with balanced visibility (85.3%) or prominent visibility (14.7%) when used in combination with other brand types. Usage of house brand type (2.5%) is negligible with no case of family brand type being reported. In case of services, as depicted by Table 4.4, corporate brand type is used in 88% of the cases. It is frequently used as single brand type (55.7%) as well as in combination with other brand types (44.3%). It is most often used as an endorser (52.6%), with balanced visibility (19.2%) or as a token endorser (16.7%) when used in combination with other brand types. Individual brand type is another frequently used brand type (44%), which is most often used in combination with other brand types (84.1%), most frequently with prominent visibility (77%) or with balanced visibility (18.9%). House (3.5%) and family brand types (4.5%) are less often used. Literature on degree of risk in services brings out that services can be classified as credence and experience services. Therefore, analysis of services is extended by classifying services as credence and experience services. Credence services are highly risky services that cannot be evaluated by average consumers 94

13 Table 4.4 Analysis of ing Strategies Used in the Three Sectors Visibility Sector Durables Services FMCG Type Single Type Corporate House Family Individual Corporate House Family Individual Corporate House Family Individual The Only Type 157 (82.6) 4 (8) () 5 (12.8) 98 (55.7) 3 (42.9) 1 (11.1) 14 (15.9) 25 (16.4) 4 (44.5) 18 (19.1) 13 (13.8) Prominently Visible Balanced Endorser Linked Name Token endorser () 29 (87.9) 4 (12.1) () () () () 1 (1) () () () () () () () () () 5 (14.7) 29 (85.3) () () () 6 (7.7) 15 (19.2) 41 (52.6) 3 (3.8) 13 (16.7) 4 (1) () () () () () 1 (12.5) 3 (37.5) 1 (12.5) 3 (37.5) 8 (88.9) 57 (77) 14 (18.9) 3 (4) () () 2 (1.6) 12 (9.5) 44 (34.7) 5 (3.9) 64 (5.4) () 3 (6) 2 (4) () () 57 (75) 5 (6.6) 14 (18.4) () () 62 (76.5) 17 (2.9) 2 (2.5) () () Combination of Multiple Types Total 33 (17.4) Total * 19 (95) 1 (2) 5 (2.5) 34 (87.2) 39 (19.5) 78 (44.3) 176 (88) Note: Percentages within parentheses. * Percentages in each sector do not add to 1% because more than one brand type can be used for a single brand. 4 (57.1) 7 (3.5) 9 (4.5) 74 (84.1) 88 (44) 127 (83.6) 152 (76) 5 (55.5) 9 (4.5) 76 (8.9) 94 (47) 81 (86.2) 94 (47) 95

14 even after purchase or consumption because they lack the technical expertise or the means in terms of time and money to make a reliable assessment (Nelson, 197; Darby and Karni, 1973; Zeithaml, 1981). Experience services are less risky services that can be evaluated after purchase or during consumption (Shapiro, 1983). Based on the examples cited in past literature, experience services we content analyzed include retail outlets, beauty salons, telecom services, vacations, hotels, aviation, job and marriage consultancy, media entertainment, and education, and credence services include financial and health services. The sample of 2 service brands comprises 131 experience service brands and 69 credence service brands. Results reveal that single corporate brand type is most often used branding strategy among credence services (97.1%). Combination of brand types, such as corporate and individual brand types, is most frequently used branding strategy among experience services (64.5%), followed by single corporate brand type strategy (24.4%). Table 4.4 reveals that in the FMCG sector, corporate brand type is used in 76% of the cases. It is used as single brand type in 16.4% of the cases and in combination with other brand types in 83.6% of the cases, most often as an endorser (34.7%) or as a token endorser (5.4%). The usage of house brand type is almost negligible (4.5%). Family brand type is used in 47% of the cases. It is used as single brand type in 19.1% of the cases and in combination with other brand types in 8.9% of the cases. It is most often used with prominent visibility (75%) or as an endorser (18.4%) when used in combination with other brand types. Individual brand type is used in 47% of the cases. It is used as single brand type in 13.8% of the cases and in combination with other brand types in 86.2% of the cases, most often with prominent visibility (76.5%) or with balanced visibility (2.9%). In summary, the above analysis reveals that different types of branding strategies are used in the three sectors. In the durables sector, single corporate brand strategy is most commonly used. In the services sector, single corporate brand type is the most often used branding strategy for credence services while combination of multiple brand types, such as corporate and individual brand types, is most often used branding strategy for experience services. Finally, combination of multiple brand types such as corporate, 96

15 family and individual brand types is most frequently used branding strategy in the FMCG sector. MANOVA Results and Hypotheses Testing The above analysis depicts that there are differences in the branding strategies across the three sectors. To know whether these differences are statistically significant, visibilities of the four brand types namely corporate, house, family and individual brand types in the three sectors are compared using MANOVA and hypotheses are thus tested. Sector type is taken as the independent (categorical) variable and visibility scores of the four brand types, measured on a nine-point scale (1 to 9), are taken as dependent (continuous) variables for conducting MANOVA. Table 4.5 provides a summary of the group profiles (means and standard deviations (SDs)) for each of the brand types across the three sectors. Type Table 4.5 Means and SDs * of Visibility Scores for Each Sector Sector Durables Services FMCG Corporate Type 8.27 (1.781) 6.75 (2.659) 4.32 (2.393) Individual Type 2.24 (2.555) 4.5 (3.476) 4.25 (3.487) Family Type 1. (.) 1.18 (.928) 4.19 (3.467) House Type 1.19 (1.174) 1.28 (1.374) 1.3 (1.396) * SDs are within parentheses. of significance. Thus, the assumption of homogeneity of variance across the sectors is not satisfied. Harris (1995) and Hair et al. (29) state that in such a situation, if the sample size is large and cell sizes are equal across the groups, then MANOVA can be conducted. As the present research work has sufficiently large sample size (N=6) and equal cell sizes (2 each), we proceed further with the analysis. Further, a significant degree of inter- Test of Sphericity (Approx. Chi Square = , df = 6, sig.<.1) which justifies the usage of MANOVA. Further, the results of multivariate and univariate tests are given in Table

16 Table 4.6 Multivariate and Univariate Tests for Group Differences in Type Visibility across the Three Sectors a. Multivariate Tests F df Error df Sig. Partial Eta Squared Observed Power ** * b. Univariate Tests Hypotheses Dependent Variable Sum of Squares df Mean Square F Sig. Partial Eta Squared Observed Power ** Result H1 Corporate Type * Supported H2 Individual Type * Supported H3 Family Type * Supported H4 House Type Supported * Significant at 1% level. ** Computed using alpha =.3 (Boneferroni Adjustment (Hair et al., 29)). 98

17 Table 4.6 (a) depicts that multivariate statistic for MANOVA is statistically significant =.535, F (8, 1188.) = , p<.1, partial eta squared =.269, power = 1.) indicating that the visibilities of the four brand types taken together differ across the three sectors. Follow-up univariate tests of group differences by examining the F-ratio (Table 4.6-b) indicate that visibilities of three out of four brand types differ significantly across the three sectors (p<.1). In particular, the F value for corporate, family and individual brand types is significant (p<.1), while it is insignificant for house brand type (p>.3). Thus, all the hypotheses, H 1, H 2, H 3 and H 4 are supported, meaning thereby that the differences across the three sectors are significant with respect to the visibilities of the corporate, family and individual brand types, while insignificant for the house brand type. Table 4.7 reports results of post- -wise comparison of the three sectors for the three brand types that had significant univariate F values. Table 4.7 for Individual Group Differences in Type Visibility across the Three Sectors Dependent Variable Corporate Type Individual Type Family Type Sector I Sector J Mean Difference (I-J) ** Std. Error Sig. FMCG Services * FMCG Durables * Services Durables * FMCG Services FMCG Durables * Services Durables * FMCG Services * FMCG Durables * Services Durables * Significant at 1% level. ** Minus sign indicates that group I has the lower value than group J. While examining Table 4.7, we find that the visibility of corporate brand type significantly differs across the three sectors (p<.1). Mean differences (I-J) indicate that the corporate brand type is most visible in the durables sector followed by the services concerned, the durables sector significantly differs from the FMCG (p<.1) and the 99

18 services (p<.1) sectors, but no significant differences have been found between the FMCG and the services sectors (p>.3). Mean differences depict that individual brand type is more visible in services and FMCG sectors than in the durables sector. Regarding family brand type, the FMCG sector significantly differs from durables and services sectors (p<.1). However, no significant differences have been found between durables and services sectors in the visibility of family brand type (p>.3). Family brand type is more visible in the FMCG sector than in the durables and services sectors as depicted by mean differences. Thus, MANOVA results confirm that the differences across the three sectors with respect to the visibilities of the three brand types namely, corporate, family and individual brand types are statistically significant. On the other hand, the visibility of house brand type is similar in the three sectors. Post hoc results indicate that corporate brand type is the most visible brand type in the durables sector, followed by the services sector and is the least visible brand type in the FMCG sector. Individual brand type is equally visible in the services and the FMCG sectors, but is less visible in the durables sector. Family brand type is more visible in the FMCG sector than in the durables and services sectors, and it is equally visible in the durables and the services sectors. DISCUSSION A general observation reveals that there is a lot of diversity and complexity in the way companies are using branding strategies. The current research helps to simplify this complexity by disclosing that the three sectors are heterogeneous among themselves and homogeneous within themselves with respect to the branding strategies. No doubt, there are various factors that impact the choice of branding strategy such as history, corporate culture, company policy, product range, market structure etc. (Hall, 1992; Laforet and Saunders, 1994, 1999), however, our findings suggest that the characteristics of a sector do have an influence on this decision. Our results reveal that corporate brand type is frequently used in all the three sectors, but with different visibility styles. In case of durables and credence services, it is used either as the single brand type or with prominent visibility. Contrarily, in case of FMCG and 1

19 experience services, single corporate brands are not used; rather they are used as endorsers. Past literature suggests that the use of corporate brand positively influences consumer preferences (Andreassen and Lindestad, 1998; Kowalczyk and Pawlish, 22; Balmer and Gray, 23; Czellar and Palazzo, 24; Souiden et al., 26; Anisimova, 27). However, this influence also depends upon the visibility of the corporate brand in communications, that is, higher the visibility of the corporate brand, more is its influence on the consumers (Saunders and Guoqun, 1996; Berens et al., 22; Berens et al., 25). Also, higher the risk and consumer involvement, more do the consumers rely on corporate associations (Gurhan-Canli and Batra, 24; Berens et al., 25). Supporting these past findings, our results show that the corporate brand is used with high visibility in case of durables and credence services as they are associated with higher risk and consumer involvement, while in case of FMCG and experience services, it is used with low visibility as they are associated with relatively lesser risk and consumer involvement. Hence, brand managers give visibility prominence to corporate brand type to the extent to which mitigating risk involved in consumer purchases is the primary purpose of branding. Further, the results depict that the usage of house brand type is negligible in the three sectors. The findings are in contradiction with Laforet and Saunders (1994) who find that house brands tend to appear more than corporate brands in the grocery sector in the UK. Further, as anticipated, house branding strategy is found to be equally popular in the three sectors. It is also found that family brand type appears rarely in both the durables and services sectors, while it appears significantly in the FMCG sector. As durables and services sectors are associated with high risk, corporate brand is preferred over family brand in these two sectors to create salience across a range of offerings and hence, family brand is seldom used in these two sectors. FMCG sector is associated with low risk; therefore family brand is used in this sector for creating synergies across a group of related products. 11

20 The findings reveal that the extent of usage of individual brand type is the same in case of FMCG and services sectors. This may be because individual brand type is extensively used in case of FMCG and experience services, and an overview of the sample of services brands reveals that more experience services brands than credence services brands are included in the sample. Individual brand type is frequently used for FMCG and experience services essentially for two reasons. First, FMCG and experience services are less risky. Researchers state that these are purchased on the basis of intangibles as well as tangibles such as price (Ostrom and Iacobucci, 1995; Moorthi, 22; Brady et al., 25). Therefore, corporate brand is relatively less important for such purchases. Second, the companies want to capitalise the benefits of segmentation through individual branding (Laforet and Saunders, 1999; Aaker and Joachimsthaler, 2; Vijayraghavan, 23; Rajagopal and Sanchez, 24). Further, single brand type strategy is not used for FMCG and experience services. Combinations of multiple brand types namely individual, corporate and family brand types are used in the FMCG sector. This finding is in line with Laforet and Saunders (1994, 25 and 27) who find that more than 5% products in the grocery industry in the UK carried more than one brand type. Combination of individual and corporate brand types is the commonly used branding strategy for experience services. This finding is consistent with Rahman and Areni (29) who suggest that services can benefit from sub-brands, but is in contradiction with a priori research which states that corporate brand is always the primary brand for services (de Berry, 2; McDonald et al., 21; Burt and Sparks, 22 and brand proliferated markets, it has become extremely difficult and expensive to develop new brands from scratch that have the potential to be successful. Hence, companies prefer to use two brand types together, one already established brand called master brand (Corporate/Family ) and another new individual brand. Master brand adds credibility to the offering, and individual brand adds value by describing the offering and by modifying the associations of the master brand through creation of specific brand beliefs (Aaker and Joachimsthaler, 2; Keller, 28). The use of master brand also eases the acceptance of new product by the trade (Laforet and Saunders, 1994; Petromilli et al., 22). 12

21 Thus, this chapter contributes to the growing body of literature on branding strategies by identifying an original and more simplistic list of branding strategies and by examining and comparing the usage of branding strategies in the three sectors durables, services and FMCG. The findings substantiate that the three sectors differ in their branding strategies. Single corporate brand type strategy is predominantly used in case of durables and credence services which are associated with high risk and high consumer involvement. On the other hand, in case of FMCG and experience services, which are associated with low risk and low consumer involvement, individual brand type endorsed by the corporate brand type is the most frequently used branding strategy. Thus, we can conclude that there is a trend towards corporate branding as corporate brand type is popular in all the sectors. Also, a single brand type strategy is rarely used, except for the single corporate brand type strategy as in case of durables and credence services. For FMCG brands and experience services brands, companies are trying to leverage brand equity of two or more brand types. 13