Professional Documents
Culture Documents
Brands and Reputation Management
Brands and Reputation Management
Introduction
Brands today have an essential role in the business strategy of top organizations (de
Chernatony and Segal-Horn, 2011 cited in Herstein and Zvilling, 2011). From the
organizational point of view, a strong brand with admirable equity can provide the
organization with many benefits including an increased customer loyalty, competitive
advantage, less exposure to marketing crisis, positive customer reactions to price
fluctuations, efficient marketing communication and brand extension opportunities (Keller,
2001). However, from the customers perspective a brand is represented by a set of mental
associations (Hallawell, 1999) that may help the user understand himself better by
identifying with the product (Schmitt, 2012).
The American Marketing Association (1960) defined the brand as A name, term,
sign , symbol, or design, or a combination of them, intended to identify the goods or
services of one seller group of sellers and to differentiate them from those
competitors(Cited in Wood, 2000, p.664).
However, brands are a constant presence in the everyday life of consumers (Albert,
Merunka and Vallette-Florence, 2008). Consequently, the brand is not built only according
to the strict aspirations of the company but is influenced by stimuli from other sources.
Customers respond to the experience offered by the company and create images and
meanings regarding that experience (Rindell and Strandvik, 2010). The growing popularity
of technology transforms the consumer into a content creator by means of a camera
(Gainess-Ross, 2010). This implies that the rise of citizen journalism through new media
communications may have a devastating effect on the brand image since the company may
be exposed to calumny and sabotage (Mei, Bansal and Pang, 2010) as McDonalds
discovered when consumers began to criticize the quality of its products through social
media platforms.
There are various areas that have been tackled during the courses. Among them the
concepts of brand equity, branding of the self, semiotics, brand visioning, corporate
identity, internal marketing and reputation management have been discussed. However, I
have chosen to highlight the contributions of brand equity, semiotics, brand visioning and
internal marketing to brand management.
The worlds largest food service organization opened its first restaurant at Des
Plaines, Illinois in 1955. Its rapid expansion along the years led to the opening of 30,000
restaurants in over 120 countries with sales that reached an excess of $ 40 billion in 2001
(Jones et al. 2002). McDonalds is renowned for its burgers and fries that are sold in the US,
Europe, Asia Pacific, the Middle East and Africa. Its current headquarters is in Oak Brook,
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around the world (Simoes and Dibb, 2001) and are easily understandable as the initial M
of McDonalds (Lee, So and Wong, 2006). The color of the logo, yellow is a strong attention
grabber that relates to summer and may convey the message cheap and cheerful( Blythe,
2005) which is exactly how the company is reviewed on recommendation websites
(Appendix 2).
The slogan and mission of an organization encompass the position of the company
and its marketing objectives (Lee, So and Wong, 2006). According to the 2003 McDonalds
CMO, Larry Light, the slogan Im lovin it encompasses all the reasons why the customers
love the brand as well as the idea of being welcome whether your financial resources are
scarce or not (Crain, 2013). This approach is very consistent with the logo since both
elements convey the idea of cheap products.
Packaging represents the last form of marketing communication that the company
can use before the actual purchase is made therefore it is an important element in the
communication mix (Blythe, 2005). Each time customers enter the McDonalds restaurants,
they inevitably come into contact with the brand since it is displayed on the burger
wrappers, packaging for fries and cups (Simoes and Dibb, 2001).
Consequently McDonalds ensures that the company image is memorable by
encompassing the brand in the golden arches logo, the packaging of the products, and
restaurant outlets (Simoes and Dibb, 2001).
In the vision of Keller, (1991) customer brand equity takes place when the
consumer is familiar with the brand and mentally attributes some positive, strong, and
distinctive brand associations to the brand. According to Oliver, (1997) brand loyalty is the
basis of brand equity and is defined as the devotion to repeatedly buy a preferred product
or service resulting in repetitive brand purchasing in spite of other marketing strategies to
alter such behavior(Cited in Kumar, Dash and Purwar, 2013, p.147). However, DelgadoBallester and Munuera-Aleman (2005,) identified trust as the most important aspect in
developing brand loyalty and define the concept as the confident expectations of the
brands reliability and intentions (Delgado et al. 2003). For Dwyer et al.,(1987) the
consumption experience which leads to formation of associations, opinions and inferences
is the reservoir of brand trust (cited in Delgado-Ballester and Munuera-Aleman, 2005,
p.188-189).
Brand equity can be enhanced by engaging the customers interest and participation
through soliciting consumer generated content (Thompson and Swan Tan, 2002).
Therefore, McDonalds decided to lead discussions in their site
yourquestions.mcdonalds.com.au where customers have the opportunity to ask questions
about the products commercialized by the company (Appendix 1). Consequently, the
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company not only manages to boost their credibility but the customer trust as well as since
it gives consumers the feeling that it has nothing to hide about its products and their
preparation and it is willing to answer any question related to them. This can only have a
positive effect in developing the customers attachment to the brand since many regular
customers visit McDonalds on a daily basis,(Strategic Direction, 2007) many of the
McDonalds products such as Big Mac , McGriddle or McMuffin are famous fast food brands
with strong customer loyalty (McDonalds Corporation SWOT analysis, 2013).
In the vision of Lassar, Mittal and Sharma (1995), brand equity comprises of two
elements, brand strength and brand value. Brand value is defined as the utility of the brand
in comparison with its costs perceived by the consumer through simultaneous reflections
regarding the product received and the financial sacrifice implied by its purchase.
According to Simoes and Dibb, (2001), McDonalds provides its customers with efficient
service of good value as well as good quality items. The good value may be reflected in the
cheap food alternative that the company offers such as the One Dollar Menu.
Brand strength is not centered only on the behavioral significance of its customers
but on the meaningfulness of the conduct displayed by the internal stakeholders, the
employees (Burmann, Jost-Benz and Riley, 2009) since the success of a brand depends on
the consistency between the managerial proposed values, the efficient application of the
values by the staff and the interpretation of these values by customers (De Chernatony,
2002). McDonalds acknowledged the key role that staff play in enhancing the brand
strengths consequently it has invested in the sustainable training of its staff.
Consequently, ranging from the counter staff who are enrolled in programmes such as the
Impressive Service which are destined to strengthen their skills in order to develop
exceptional customer service and satisfaction, to members of management who receive
training at regional centers or at the national center, Hamburger University, all the
employees of McDonalds are constantly educated in the science of hamburgeology
(Tomkins, 1995).
Nevertheless, employees also play a key role in brand visioning. By involving them
in the process, their adoption of a certain type of behavior and acceptance of brand related
aspects will be facilitated (De Chernatony, 2002). Additionally, the including of staff in the
brand visioning process enables the employees to be become more aware of the challenges
and opportunities of the future, it encourages staff contribution and dedication if their
opinions are considered, and apart from establishing a strong cultural bond, management
can benefit from an abundant array of ideas. In order for a company to achieve success, it
needs to be open to change and be able to think broad about the future. Brand visioning is
concerned with the implementing of long-term benefits for stakeholders through
welcoming change and motivating staff to bring about change (De Chernatony, 2010).
Consequently, McDonalds decided to involve owner-operators, staff members at all levels
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and suppliers in the product devising process by testing their ideas in the Innovation
Center, responsible for creating, reviewing and testing product innovations (Gubman and
Russell, 2006).
Hamel (1996) has suggested several approaches that an organization may follow
when adopting changes for their future. The first is rethinking and redivising the product
or service (Cited in De Chernatony, 2010, p.127). On October 2013, a newspaper article in
Time.com was announcing McDonalds pledge to serve sustainable beef by 2016. The
company decided to reconceive its products in order to improve the environmental
conditions in which the beef is produced, assist good working conditions in the beef
industry and support ongoing development in the animal health and welfare (Frizell,
2014).
A second approach for reinventing the market space for the future is by increasing
accessibility (Cited in De Chernatony, 2010, p.127). Therefore, McDonalds decided to meet
the demands of the increasingly 24 hour society and suggested its franchises to open
restaurants during night times as well. As a result, McDonalds increased its accessibility in
order to satisfy the needs of night workers, clubbers in want of a snack in the early hours of
the mornings and sleepless retired people (Strategic Direction, 2007).
Another step in and organizations preparation for the future is the redrawing of
industry boundaries by driving convergence (Cited in De Chernatony, 2010, p.127).
McDonalds decided to measure forces with competitors such as Starbucks by introducing a
variety of richer, stronger blends of coffee, breakfasts and deserts. As a result, hot breakfast
sandwiches such as McDonalds Egg Muffin has become one of the restaurants most
popular meal (Strategic Direction, 2007).
However, in order to build an attractive corporate brand for customers,
organizations need to make the company brand appealing to employees as well (Lambert,
1995, cited in Varey and Lewis, 1999, p.928).Considering that the customers impressions
about the organization is highly dependable on the performance of the interaction between
them and the contact personnel (Parasuraman et al.1985), Sasser and Arbeit (1976)
believe employees are the representatives of the companys image. Consequently,
managers need to find solutions to effectively manage contact employees in order for their
behavior to reflect the quality of services. In this case the solution would be for
organizations to adopt effective internal programmes centered on their personnel
(Heartline and Ferrell , 1996)(Cited in Lings, 2004,p.408).
Kotler (1991) has defined internal marketing as the process of successfully
employing, training and motivating capable employees to serve the client well (Cited in Pitt
and Foreman, 1999, p.25). Regarding McDonalds recruitment process, the company has
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included in the online application process a job preview where potential candidates may
test themselves in order to see whether the desired job is the right one for them. However,
the questions and feedback offered by the job preview is based on the core values of the
company, therefore, in an indirect manner, the company effectively selects the desired
candidates by declaring them appropriate or not for the job offered (Appendix 3).
Training seems to be as well an important part of the McDonalds company policies
since, as earlier acknowledged in the paper, all of its employees undergo continuous
training regardless of the function they occupy in the company. For instance, counter staff
is trained to respect the QSC (quality, service and cleanliness) standards which are the
principles behind the education and training activities of the company. Floor managers
have the opportunity to further progress in their career by undertaking the management
development programmes which have been specifically devised to provide them with the
theoretical and practical information they require while board members enhance their
abilities through the year plan entitled the 3-1-Q concept which encompasses financial and
business skills training (Tomkins, 1995).
However, McDonalds seems to be encountering difficulties in motivating its staff as
one article from Forbes.com , 2013 reveals. According to Forbes contributor, Laura Forbes,
McDonalds sample budget assumed the companys employees had two jobs while
neglecting the other expenses such as clothing, groceries or child care. As a result, the
employees interviewed in the article express their disapproval of McDonalds policies as,
the money received is not sufficient for them to pay their expenses and purchase food as
well (OConnor, 2013).
Unfortunately, this may have a negative impact on the firms image as the corporate
reputation of an organization depends on the employees feelings about what they receive
from their employer (Helm, 2011).According to George (1990) and Harris and de
Chernatony (2001) the employees are the ones who continuously influence the
stakeholders perceptions and opinions of the organization (Cited in Helm, 2011, p.657)
therefore they play a crucial role in handling the companys reputation.
may be the videos referring to the low quality of the products that may affect the health of
the consumers (Appendix 4) that are posted on Youtube.com or the online communities on
Facebook (Appendix 5) that militate against the company for the same health concerns.
For Pompper and Higgins (2007) the negative image portrayed by a documentary
film may constitute the object of a crisis. A relevant example of damaging corporate
reputation may be the documentary film entitled Super Size Me where the main
character, Mr. Spurlock ate McDonalds fast food products three times a day for 30 days and
as a result, gained 11 kg. According to a study conducted by Cottone and Byrs-Bredbenner
(2007) in order to measure the psychological effects of the documentary on 194
individuals, the film had a significant emotional impact on the audiences increasing their
awareness towards the importance of maintaining a good health thus leading to lifestyle
changes that promote weight loss and/or maintenance. Consequently, the documentary
may prove to be useful in fighting the obesity epidemic (Cottone and Byrs-Bredbenner
2007) and at the same time a destructive factor for the popularity of McDonalds fast food
products.
In the vision of Khodarahmi, (2009a) strategic thinking represents the key to
anticipate and deter potential crisis. Cutlip, Center and Broom (2000) believe public
relations is a scientifically managed contributor to the organizations problem solving and
improving process by the employment of a reciprocal relationship between research,
planning and evaluation.
Through the systematic research undergone by the public relations department the
organization can understand and verify the assumptions regarding the effects of the
organization on its publics (Cutlip, Center and Broom, 2000) and scan the environment for
potential threats or disruptive relations with the stakeholders that can have a negative
effect on the organizational reputation (Monn and Warnaby ,1997) (Cited inMcCoy and
Hargie, 2003, p.313).
According to Kash and Darling (1998) strategic planning is the key for predicting
and managing various issues and difficulties that exceeded their power of control of the
organization. Therefore, Khodarahmi (2009b) believes that public relations have the power
to incite organizational success through the plans issued by its strategic planning.
The evaluation supports all the previous stages of the programme (Theaker, 2012)
as it is continuous and central to the process (Gregory, 2000). Additionally, Cutlip, Center
and Broom (2000), believe that a thorough evaluation can measure the impact that the
public relations programme has had on the companys audiences as well as on the
organization and their common shared social and cultural environment (Cutlip, Center and
Broom,2000).
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According to Fortunato (2011), the need for corporate social responsibility is much
more prominent in the case of organizations that commercialize products considered as
behavior risk such as the fast food industry since it retains significant public attention and
visibility due to the fact that it supports the demands for sustaining daily human life
(Maloni and Brown, 2006).
As a leading global brand for over three decades (Keynote, 2003) McDonalds has
attracted the attention of the governmental public interest campaigns such as the Food
Standards Agencys promotion of healthy eating as well as the interest of the consumer
lobby groups such as the Consumers Association. As a result, the employment of corporate
social responsibility is essential for responding and handling such challenges (Cited in
Schroder and McEarchern, 2005, p.220).
In recent years, the phenomenon categorized as obesity crisis has received
increasingly significant attention as since the 1980s the number of individuals suffering
from obesity has increased from 8% for women and 6 % for men to 21% and respectively
17% in England while currently 30% of the USA population is obese. What is more, obesity
among 2 to 4-year olds have increased from 5% to 16% between 1989 and 2001 (Crossley,
2004). According to Stender, Dyeberg and Astrup (2007) frequent consumption of fast-food
products may lead to weight gain, obesity, type 2 diabetes and coronary artery disease as
the fat content of a McDonalds menu may vary between 41 and 65 grams of fat (Stender,
Dyerberg and Astrup, 2007).
In this sense, McDonalds has decided to offer more healthy and nutritious options
among its products by including more servings of fruits and vegetables in its menus.
Additionally, focusing on reducing the childhood obesity phenomenon, in 2011 McDonalds
released Commitments to Offer Improved Nutrition Choices in order to support
customers in making a nutrition-minded decision. Consequently, since early 2012
McDonalds happy meal includes a serving of apple slices and fewer French fries. The
company has also committed to promoting nutrition and lifestyle messages in all of
children communication processes, including merchandise, advertising and packaging
(Fortunato, 2011).
What is more, McDonalds Sustainability Report from 2010 includes a list of
Childrens Global Marketing Guidelines through which the company commits itself in
communicating balanced food choices to children, supporting and encouraging activity and
balanced food options with the use of the licensed characters, contributing to the wellbeing of the body and mind of children through positive messages, providing nutrition facts
in order to help parents in making a nutrition minded decisions and collaborating with
experts in the domain for guidance of the companys efforts towards children and families
worldwide (McDonalds Corporation Social Responsibility Report, 2010).
11
Conclusion
In the last decade, branding has acquired the position of top management priority as
organizations realize it is one of the most assets they can have (Kevin and Lehmannn,
2006). Brands may offer the basic traits that differentiate between competitive offerings,
therefore, they are essential to the success of the companies (Wood, 2000).
The name and logo of McDonalds manages to differentiate itself from the
competition while capturing the attention of the customers as it is a familiar sight for
customers around the world. What is more, the memorability of the company image is
enhanced by the consistency between the company logo, packaging of the products and
restaurant outlets(Simoes and Dibb, 2001).
Additionally, McDonalds manages to create brand value by offering customers
excellent service as well as good quality items at reasonable prices (Simoes and Dibb,
2001) as well as strengthen the brand by investing in the constant training and developing
of skills of all its personell (Tomkins. 1995).
The process of brand visioning is also done with the support and contribution of the
McDonalds staff. Owner-operators and suppliers and employees are involved in the
product devising process as their ideas are tested in order to constantly devise product
innovations (Gubman and Russell, 2006).
What is more, since according to Sasser and Arbeit (1976), the employees are the
representatives of a companys image (Cited in Lings, 2004, p.408), McDonalds bases its
online selection process on selecting the candidates that encompass the values of the
company. However, in spite of the importance that is placed on constant training and
developing, McDonalds seems to encounter difficulties when motivating its staff.
12
13
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Appendix 1
Appendix 2
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Appendix 3
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Appendix 4
Think Twice before you eat McDonalds http://www.youtube.com/watch?v=fSHaZIOk9nY
This is Why You Shouldnt Eat Happy Meals http://www.youtube.com/watch?v=FoFpsUvaJlE
Appendix 5
https://www.facebook.com/pages/Mcdonalds-is-gross/214269244766?fref=ts
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