The use of Branding as a Marketing Strateg (Case Study Sample)

The use of branding, as a marketing strategy, for Western MNCs in developing markets: Case study of Apple in China.
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Abstract
This paper looks at the role of branding to Western MNCs that are moving into the developing markets. Branding is one of the most common marketing strategy that business entities have adopt in their home economies to compete and establish significant market share. Literature review shows that multinationals have used various branding approaches in the developed markets. It also shows that the branding approach is dependent on the company’s entry style. This research adopted the RBV model as the conceptual framework for this research. In order to gain insight into the role of branding in developing countries, the researcher undertook a case study of Apple’s branding in China. The adoption of a qualitative approach would help to provide insight into the company’s experiences in the country. The findings of this research suggests that Apple’s branding approach in China has been significantly successful as it has propelled the country into the top of the elite luxury brands. It has also helped the company develop the Chinese market into one of its most important market.
Contents TOC \o "1-3" \h \z \u Abstract PAGEREF _Toc415692610 \h 21.Introduction PAGEREF _Toc415692611 \h 42.Literature Review PAGEREF _Toc415692612 \h 5a.Definitions PAGEREF _Toc415692613 \h 5i.Marketing strategy PAGEREF _Toc415692614 \h 5ii.Branding PAGEREF _Toc415692615 \h 53.Theoretical models PAGEREF _Toc415692616 \h 6a.Resource based view PAGEREF _Toc415692617 \h 6b.Approaches to branding PAGEREF _Toc415692618 \h 6c.Empirical studies PAGEREF _Toc415692619 \h 74.Methodology PAGEREF _Toc415692620 \h 95.Findings and discussion PAGEREF _Toc415692621 \h 10a.Adoption of branding PAGEREF _Toc415692622 \h 10b.Success of branding PAGEREF _Toc415692623 \h 11c.Weaknesses of branding PAGEREF _Toc415692624 \h 126.Conclusion PAGEREF _Toc415692625 \h 12
1 Introduction
Most of the current literature concedes that marketing strategies are important to multinational corporations (MNCs) seeking to enter into the developing countries. Jones (2010) argued that marketing strategies are tailored to counter or take advantage of (1) political environment, (2) resources and market of the host country, and (3) competition from local and foreign firms. Ferrell and Hartline (2012) identified branding, positioning, target marketing and market segmentation as four generic marketing strategies that organizations can pursue. Successful multinationals have adopted branding in order to popularize their products. MNCs have adopted this strategy to enter and concur new markets such as China and other developing countries.
Cui and Liu (2000) observed that China represents a large population that has a high increase in consumer spending, which has attracted many MNCs to exploit this potential. Apple Inc. is one of the western MNCs that have moved into the country to take advantage of the market. Although the company is one of the most iconic technology brands, it still has had to contend with competition from other technology companies such as Samsung and local Chinese products. This paper seeks to analyze the role that branding, as a marketing strategy, has played in popularizing western MNCs, products with a focus on Apple. It will also seek to determine whether it has been successful as a marketing strategy or not. In addition to this, the research will seek to find out whether branding is sufficient on its own or the company ought to do more in order for the strategy to be successful.
In order to accomplish this chief purpose, the paper will have to fulfill the following objectives: (1) identify how Apple has adopted branding in China, (2) identify the success of branding as a marketing strategy, and (3) identify the weaknesses of the company’s branding and make recommendations on how the company can improve in these areas.
2 Literature Review
Numerous scholarly materials have been written on branding and multinational businesses. The purpose of this section is to review the various definitions to literature review. The section will also provide a theoretical framework that will be integral to the research. In addition to this, the section will review relevant empirical studies that will shed light on this research.
1 Definitions
1 Marketing strategy
According to Varadarajan (2010), marketing strategy is concerned with issues that helps an organization to gain long term advantage at the strategic business unit or firm level. It is hence well defined framework that a firm is supposed to follow in order to create awareness of its products into the market, as it aims at attracting new consumers, and maintaining the old ones. The author also observed that marketing is dynamic as the market place always poses fresh set of challenges that business entities must respond to effectively in order to be successful.
2 Branding
Branding is the process of developing a brand. In this case, a brand may refer to a product, a company or an organization. The essence of branding could be to create an outwards appearance, or establish an innate image in the mind on the target consumers. In this case, some scholars have described branding in terms of physical nature of a product, while others argue hat it goes beyond that, and that it is mainly concerned with the emotional feelings that consumers attach to a good or service. Therefore, it is important that the researcher defines a brand in order to enhance clarity. De Chernatony and Riley (1998) observed that there is no universal definition of a brand and that a wide range of definitions have been developed depending on the perspective adopted. The study observed that the brand can be viewed in many ways: logo, legal instrument, risk reducer, value system, shorthand, image held in consumer minds, evolving entity, value addition, relationship, personality and company. According to Todor (2014), a brand is a set of tangible and intangible attributes that are symbolized using a trademark (logo and name among others), which creates influence and value when operated properly. According to the author, this is perhaps the most complete definition of brand.
3 Theoretical models
2 Resource based view
This paper will adopt the resource-based view (RBV) model to analyze the impacts branding has had on MNCs success in developing countries. This theoretical model allows researchers to identify the various competitive edges an organization has over its competition in a given market. Holtbrugge, Friedman and Puck (2010) observed that the RBV conceptual framework holds that firms’ resources can be thought of as different bundles of resources. This model assumes that a firms’ unique and specific internal resources, rather than external conditions, are central to the success of the organization. The model postulates that these specific resources should be unique, inimitable, rare and valuable.
3 Approaches to branding
Numerous approaches are adopted in the branding exercise. This research will focus on individual product branding, family branding, generic branding, licensing branding, and store branding. Individual product branding refers to the use of a brand name for a single product. P&G is a good example of a company that uses individual product branding as each of its product has a different brand elements (Curtis, 2012). Family branding refers to the use of a brand name for more than one product as is the case with Del Monte, which uses its brand name on a wide range of fruit and vegetable products. Store branding is another approach common among multinationals. According to Abril, Gavilan and Avello (2009), store brands improve the efficiency of the distribution channels. It is imperative to note that retailers have control over the positioning of the store brands, which makes the stores valuable to the retailers.
Store branding has significant influence on the performance of the brand. Webster (2000) observed that retailers (resellers) are increasingly becoming influential in the market place such that some organizations have been forced to redefine their consumers as the resellers. The increased strength of the resellers is increasingly weakening the strength of specific brands. Generic branding is sometimes referred to as no branding. According to Solomon et al (2013), organizations adopt generic branding to offer the products customers need at the lowest prices for the standard products. It is important to note that this branding approach is not common for electronics as it is commonly used for basic products such as foods. Brand licensing is another common branding approach and it involves one business entity licensing other business entities to use their brand. In this case, it could license a business that produces related products, or in some cases, another manufacturer could be allowed to produce similar goods under the same brand. This is common with clothing produced to take advantage of another product such as movies. The last approach adopted in co-branding. According to Beckman and Willas (2005), co-branding involves long term or/ and short-term association between more than one individual brands. Cunha, Forehand and Angle (2015) observed that new products will partners with well-established brands hoping that this will benefit them through the positive association and awareness that the well-established product will create.
4 Empirical studies
A number of research studies have been undertaken on MNCs adoption of branding globally. It is imperative to note that most multinationals have saturated their products in the developed countries before pursuing expansion into developing countries. This is simply at...