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The overall equity of a brand is the sum of the brand strength of all single consumers. In the context of co-creation, it is interesting to differentiate between the effects on integrated consumers (Participant-Based Brand Equity, PBBE) and non-integrated consumers (Observer-Based Brand Equity, OBBE). Little is known about the effects of co-creation on the OBBE in academic research so far.
This paper has the purpose to approach this gap in knowledge. Firstly, this paper empirically analyzes the general effect of co-creation on the OBBE. Secondly, the laboratory experiment tests the influence of different implementations of the co-creation approach on the OBBE.
The variables to be tested are intensity of integration and validation level of integrated consumers. Different types of integration are tested and presented to non-integrated consumers with the help of communicational means (advertisements, press releases). These levels indicate how far consumers are integrated into the process of co-creation. The levels to be tested in this paper are democratically voted (weak intensity) and commonly created (strong intensity) (Fuchs and Schreier 2011; Fuchs et al. 2010, 2013). No co-creation will be used as control group.
The concept of expertise has never been tested in combination with co-creation before although Fuchs et al. (2013) mention a similar aspect. This paper shows in how far the expertise of integrated consumers influences the OBBE. It is differed between laymen and experts. This paper also discusses whether co-creation can be a strategic method for companies to positively affect the OBBE in the mass market.
Approach An experimental research design was chosen.
The brands were taken from two different product categories, breakfast cereals (Kölln) and sport shoes (Nike). The brands were chosen based on existing studies (Gujmedia.de 2014;
aberratio GmbH 2014) exploring most common brands in Germany and on a pretest (n=34) among students to test brand awareness. The dependent variable OBBE was measured by 11 different items (Lehmann et al. 2008; Yoo and Donthu 2001; Aaker 1996; Keller 1993). The independent variables are intensity of integration and expert status. To check whether the manipulation is working a second pretest among students (n=59 students) was conducted. For each brand different groups were built. For each group a respective image of the advert was created (see appendix) that varied in the intensity of integration and in the expert status, resulting in four manipulated advertisements per brand plus one advertisement with zero cocreation. Corresponding press-texts were written for each group to underline the integration intensity and the expert knowledge of integrated consumers. The manipulation check was done for both brands and for both variables. First participants had to read the press release for the first brand, then they saw the advertisement for the first brand and then two questions (“Consumers are strongly involved in the product development”; “Consumers involved in the product development have a high level of expert knowledge”) that had to be rated on a Likert scale (1= total agree; 5= total disagree). Subsequently, participants had to do the same procedure for the second brand. A t-test showed that the manipulation of the intensity of integration for Nike (3.38 2.59; p=0.039) and for Kölln (3.31 2.27; p=0.007) worked and is significant. Also the manipulation of the expert status for Nike (3.88 2.61; p=0.001) and for Kölln (3.96 2.20; p=0.000) worked and is significant.
The main study was an experiment with a 2 (intensity of integration: democratically voted vs.
commonly created) x 2 (expert knowledge: no expert knowledge vs. expert knowledge) between-subject design plus one control group (zero co-creation). Participants were students recruited at a German university. The design of the main study was similar to the second pretest. In addition the control group (advert, press text, questionnaire) was added for both brands to measure the general impact of co-creation on the OBBE. Also a third brand (advert, press text, questionnaire) was added in the booklet for distraction purposes of participants.
Findings During the time this paper was written the study was still ongoing. Results will be presented at the conference.
Following hypotheses are set:
H1: Co-creation has a positive effect on the OBBE H2: The implementations of co-creation have an effect on the OBBE.
H2a: The intensity of integration has a positive effect on the OBBE.
H2b: Expertise has a positive effect on the OBBE.
Theoretical and Managerial Implications The classical approach to discuss co-creation as a tool in the innovation process is supplemented by exploring co-creation as a mean of brand management. The study will empirically examine if co-creation has a positive influence on the OBBE. The expected positive effect will be analyzed for two product categories, breakfast cereals and sport shoes.
Also the effects of two variables (1) intensity of integration and (2) expert status will be discussed.
The findings of the study will bear some important implications for the practical field.
Generally the study will give answer if co-creation can be used by companies to positively influence brand equity. Managers could integrate co-creation into their brand management and actively communicate it to the mass of consumers instead of just using it as a tool for innovation. To stress the user-design in communications can result in some positive effects for the brand, as an enhancement of brand-related constructs and a more positive word-ofmouth.
Adding expertise in combination with co-creation might help to convince skeptical consumers and reduce cognitive dissonances. Moreover, it might increase the level of trust and result in positive spill-over effects for the brand.
Limitations The positive effect of co-creation on the OBBE will be tested for products of low complexity.
Implications taken from the study can only be transferred to other product categories with caution, especially when it comes to more complex product and brand categories. Fuchs et al.
(2013) claim that co-creation for luxury fashion brands can have a negative impact on the brand equity. They suspect that since luxury brands are built upon an image of distance and high status, co-creation is mitigating this effect.
Another limitation can be the short-term perspective of the study. It would be interesting to monitor the effect of co-creation on the brand equity on a long-term basis. Further research could focus a longitudinal design to investigate whether the positive effect of co-creation is stable and long-lasting or whether benefits a brand gained through co-creation are mitigated over time.
Also the study does not respect the duration of the promotion. Co-creation could have a different effect on the OBBE once the information that the brand was co-created is communicated by the company over a longer period of time and consumers are confronted with that information constantly.
Possible negative effects of co-creation are not taken into account in the study. Participating consumers could have a criminal background or a doubtful political opinion that could be revealed to the mass of consumers (by coincidence). Here co-creation could trigger negative PR and word-of-mouth effects and can harm the brand. Negative communication effects could also be caused by problems within the process of co-creation itself and lead to a negative effect on the brand equity. Such problems could be for instance an unfair voting process, silly responses and results or promises a company made to participating consumers that are not held.
Finally, the study analyses only the OBBE. For the brand management, the overall effect of co-creation is interesting. It is possible, that a concrete co-creation approach has a positive effect on PBBE, but not on OBBE, or vice versa.
The results of the study should be regarded with caution as the sample consists solely of students. It would be advisable to conduct the same study again but focusing rather a more heterogeneous sample.
Also the study tests two intensities of integration and two levels of expertise. There might be a lot of other co-creation concepts companies could follow which might be worthwhile to explore in further research.
Originality Research on non-integrated consumers is of high importance for the academic and the practical field. There is a huge amount of research on innovation and the new product development process as well as on consumers involved in that process. However, academic literature fails to provide sufficient evidence for co-creation to be used as a successful brand management tool. Schreier et al. (2012) call for more research with non-integrated consumers and consumers who are not familiar with the product. Fuchs et al. (2013) asking for more research in the field of democratic decision making and product development. Ind et al.
(2013) find that the impact of co-creation on consumers and the implication for managers are not clear due to the lack of research. Hoyer et al. (2010) raise the issue what effect cocreation has on brand image and positioning of companies. Hence scientists across various journals are calling for more research on OBBE. Fuchs et al. (2013) introducing a strategy to legitimize consumers who were part of the co-creation process but they do not empirically explore the idea of expert status.
This research is one of the few analyzing the effects of co-creation on non-integrated consumers in terms of brand equity. In addition to Fuchs and Schreier (2011) and Dijk et al.
(2014) this study also examines the concept of expertise in combination with co-creation and its influence on the brand equity.
Keywords Co-Creation, non-integrated consumers, expertise, intensity of integration, Observer-Based Brand Equity References Aaker, D. (1996). Measuring brand equity across products and markets. California management review, 38(3), pp. 102-120.
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Dijk, J. v., Antonides, G. and Schillewaert, N. (2014). Effects of co-creation claim on consumer brand perceptions and behavioural intentions. International Journal of Consumer Studies, 38(1), pp. 110-118.
Fuchs, C. and Schreier, M. (2011). Customer empowerment in new product development.
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Fuchs, C., Prandelli, E., Schreier, M. and Dahl, D. (2013). All that is users might not be gold:
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Hoyer, W., Chandy, R., Dorotic, M., Krafft, M. and Singh, S. (2010). Consumer Co-creation in New Product Development. Journal of Service Research, 13(3), pp. 283-296.
Ind, N. and Coates, N. (2013). The meanings of co-creation. European Business Review, 25(1), pp. 86-95.
Ind, N., Iglesias, O. and Schultz, M. (2013). Building Brands Together. California Management Review, 55(3), pp. 5-26.
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Appendix Examples of created adverts Nike advertisement – weak intensity of integration / no expertise Nike advertisement – strong intensity of integration/ no expertise Bridging brand identity and positioning – The case of Falu Rödfärg Koch, Christian Urde, Mats Purpose The purpose of this paper is to bridge the concepts of brand identity and positioning. While the relationship between brand identity and positioning is often considered important (Aaker, 1996; Kapferer, 2012; Riezebos and van der Grinten, 2012), little is known about how identity and positioning are actually related to each other in the practice of strategic brand management. The notion ‘positioning follows from identity’ is often taken for granted and indicates a sequential development from identity to positioning, then from communication to image and reputation (see, for example, Esch, 2010). Many efforts have been made to conceptualize brand identity and brand positioning separately. For example, brand identity principles (Balmer and Soenen, 1999; Kapferer, 2012) and brand positioning typologies (Aaker and Shansby, 1982; Hooley, Broderick and Möller, 1998) influence the understanding of the concepts. While such approaches to identity and positioning are important, they remain static and are silent concerning the dynamic aspects of how identity and position finding and change processes unfold.
Brand identity helps reinforce the meaning behind a brand, both for customer and noncustomer stakeholders, and provides the opportunity to develop the brand’s position with a strategic approach to brand management (de Chernatony, 1999; Kapferer, 2012; Urde, 2003).