Discuss about the Brand Equities of FMCG Companies.
The stakeholders’ support play significant role in the brand equity of business organisations and have deep impact on their business generation. The statement holds stronger for the multinational fast moving consumer goods companies which operate in hundreds in countries. These companies as a result come under the influences of important stakeholders like governments, consumers, suppliers and even competitors. The support of these stakeholders heavily impact brand equity of these international FMCG companies and their revenue generation. The research would delve into the impact of stakeholder support on the brand equity of FMCG companies with Unilever as the example.
Unilever is a British Dutch company having its headquarters in London. The United Kingdom and Rotterdam, Netherlands. It is public limited company and currently works under the able leadership of Mr Paul Polman, its CEO. The product line of the Unilever can be divided into food and drink, home care, personal products and water purifier. The company owns international brands like Magnum range of ice cream, Dove range of beauty products, Axe grooming range for men, Surf range of laundry cleaners and Lakme beauty products and fashion (unilever.com, 2018).
The aim of the proposal would be studying the relationship between stakeholder support and brand equity. The objective of the proposal would be exploring how stakeholders are responsible for success and failure of FMCG brands.
The study would aim to find answer to the following question:
The following would be the two research hypothesis:
H0: Stakeholder support impact brand equity.
H1: Stakeholder support does not impact brand equity.
The findings from the research would prove helpful for further researches on brand equity. The multinational companies would be to use the findings to boost their revenue generation.
Hörisch, Freeman and Schaltegger (2014) mention that according to the stakeholder theory the business organisations should function in manners to benefit the stakeholders. The stakeholder refer to groups or individuals which the business organisations impact through their business operations and are in turn impacted by them. The stakeholders, according to the theory can be divided into two broad divisions, namely, internal stakeholders and external stakeholder. the internal stakeholders consist of the apex management, the managers and the employees. The external stakeholders consist of government bodies, customers, suppliers, marketing partners, financial institutions and the society at large. Strand and Freeman (2015) further points out that in the global FMCG market, the leading companies are capable of impacting each other’s businesses strategies like product strategies and pricing strategies. This is evident by presence of a number of similar products mens’ grooming range (Axe by Unilever and Gillette by Procter & Gamble) having identical attributes marketed by a small number of leading FMCG companies. This mutual impacting power which competing companies share has led to the recognition of competitors as potential external stakeholder. Raj and Aithal (2018) further adds to the opinion of Hörisch, Freeman and Schaltegger and mention that stakeholders play more important role towards the business generation of the multinational fast moving consumer goods companies. Gonzalez-Zapata and Heeks (2015) mention that government bodies form the base of the operations of these multinational companies by forming laws according to which they function. Again the consumers consume the products of these multinational companies and bring about their revenue generation. Schlaile et al. (2018) further mention that this revenue generation by consumers form the base of the brand equities the products of the multinational companies enjoy in the global market. This analysis shows that the stakeholders are capable of impacting the multinational FMCG companies. The support of the stakeholder groups like the consumers not only affect the revenue generation on these companies but decide their very sustenance in the global market.
Kumar and Patra (2017) mentions that brand equity refers to the power of particular brands to generate revenue from the market. Davcik and Sharma (2015) takes Strand and Freeman (2015) into a new light altogether. They mention that the leading FMCG companies manufacturing identical products depend on their brand value which renders them separate from the products of their competitors. The multinational FMCG companies today follow similar product strategy which comprise of manufacturing similar products in response to each other’s product strategy. Steenkamp (2017) further adds to the opinion of these authors and mentions that brand equity not only enables multinational FMCG companies to gain product differentiation but also renders them the goodwill. This goodwill the FMCG companies earn in the market enables them to promote their products in the market to attract new customers. This goodwill and brand equity of FMCG companies play significant role in their revenue generation and global competitive advantage. Kirch (2016) throws light on the darker side of brand equity, thus contradicting Steenkamp (2017). He mentions that faulty product strategy and low quality products result in weakening of the market goodwill of the companies. He points out that companies often spend immense amount of money to strengthen their goodwill and end up compromising on the quality of the products. These low quality FMCG products hamper the consumers which ultimately demeans the brand equity of the consumer products. Filatotchev and Stahl (2015) further points out that brand equity products of multinational companies are not only dependent on the product strategy but also on several external factors. Tinelli (2016) mentions that faulty acquisitions and mergers and unethical activities by FMCG companies like supporting indirect slavery are capable .bring about massive fall in the goodwill of companies. This results in fall of brand equity of the products of the multinational FMCG companies hamper their revenue generation. This analysis once proves that brand equity of companies which impact the revenue generation is in turn impacted by the stakeholders’ behaviour.
Anselmsson and Bondesson (2015) mention that customer satisfaction or CSAT refers to the level of satisfaction or benefits which customers derive by consuming particular products. The customers as important stakeholders of the multinational companies because they buy goods from these companies which leads to revenue generation for the latter. Beck and Kenning (2015) further point out that customer satisfaction is not only the basis of present revenue generation but also important for future business generation. Anselmsson and Bondesson (2015) again points out that satisfied customers promote products thus generate enable the consumer goods companies marketing these products gain more consumers. Thus, customer satisfaction is important for companies not only to sustain in the market but also retain their global positions.
The main research designs are explanatory, expository and descriptive (Lewis, 2015). The scope of the research in the topic is so vast that the researcher would require to conduct detailed study. Descriptive research design would not take into account this immense amount of study. Hence, the appropriate design would be use of descriptive design in congruence with explanatory and expository.
Post positivism theory enable the researcher to conduct incessant research which the topic being studied require. The topic relationship between brand equity and stakeholder support covers a vast area which requires in depth analysis and researcher. One can infer from this discussion that post positivism is the appropriate research method.
The method of data collection would consist of primary data collection and secondary data collection techniques. The primary data collection would include surveys and interviews. The secondary data collection on the other hand include study of secondary sources of data like articles, journals and websites.
The sources of data would secondary as well as primary. The primary sources of data would consist of interviews of 50 people. The secondary sources of data would consist of article, newspapers, journals, books and websites.
The main information which would be incorporated in the research would be based on the interviews and surveys. The findings from the surveys would be supported by findings from secondary sources.
The sample size to be considered would be 50. The respondents to be interviewed would consist of variety of respondents like consumers, government officials and students. This would enable the researcher to gain varied response to base his study on.
The researcher would only use the data collected from the respondents after gaining their consent. He would only ask question pertaining to the topic and no personal question.
References:
All brands. (2018). Unilever global company website. Retrieved 19 April 2018, from https://www.unilever.com/brands/
Anselmsson, J., & Bondesson, N. (2015). Brand value chain in practise; the relationship between mindset and market performance metrics: A study of the Swedish market for FMCG. Journal of Retailing and Consumer Services, 25, 58-70.
Beck, S., & Kenning, P. (2015). The influence of retailers’ family firm image on new product acceptance: an empirical investigation in the German FMCG market. International Journal of Retail & Distribution Management, 43(12), 1126-1143.
Davcik, N. S., & Sharma, P. (2015). Impact of product differentiation, marketing investments and brand equity on pricing strategies: A brand level investigation. European Journal of Marketing, 49(5/6), 760-781.
Filatotchev, I., & Stahl, G. K. (2015). Towards transnational CSR. Corporate social responsibility approaches and governance solutions for multinational corporations. Organizational Dynamics, 44(2), 121-129.
Gonzalez-Zapata, F., & Heeks, R. (2015). The multiple meanings of open government data: Understanding different stakeholders and their perspectives. Government Information Quarterly, 32(4), 441-452.
Hörisch, J., Freeman, R. E., & Schaltegger, S. (2014). Applying stakeholder theory in sustainability management: Links, similarities, dissimilarities, and a conceptual framework. Organization & Environment, 27(4), 328-346.
Kirch, M. I. (2016). Employer Brand in Crisis: Effects of a Values-related Crisis on Employer Brand Trust, Image and Attractiveness (Master’s thesis, University of Twente).
Kumar, S., & Patra, S. (2017). Does Promotion Mix Really Help To Enhance Brand Equity: A Literature Review. Indian Journal of Commerce and Management Studies, 8(2), 80.
Lewis, S. (2015). Qualitative inquiry and research design: Choosing among five approaches. Health promotion practice, 16(4), 473-475.
Raj, K., & Aithal, P. S. (2018). Generating Wealth at the Base of the Pyramid–A Study Using ABCD Analysis Technique.
Schlaile, M. P., Mueller, M., Schramm, M., & Pyka, A. (2018). Evolutionary economics, responsible innovation and demand: Making a case for the role of consumers. Philosophy of Management, 17(1), 7-39.
Steenkamp, J. B. (2017). The Cambrian Explosion of Brands. In Global Brand Strategy (pp. 1-13). Palgrave Macmillan, London.
Strand, R., & Freeman, R. E. (2015). Scandinavian cooperative advantage: The theory and practice of stakeholder engagement in Scandinavia. Journal of business ethics, 127(1), 65-85.
Tinelli, A. (2016). Strategies and motivations for external growth in the pharmaceutical industry: the Pfizer case.
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