International Journal of Management (IJM), ISSN 0976 – 6502(Print), ISSN 0976 - 6510(Online

),
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INTERNATIONAL BRANDING AND PERFORMANCE IMPLICATIONS IN
EMERGING MARKETS


Dr. Mauricia Miguel-Herrera Dr. K.K.Ramachandran

Business and Academic Consultant, Director,
MMH Consulting GRD Institute of Management,
Dr.GRD College of Science,
Coimbatore-641 014



ABSTRACT

The central role of branding in establishing the firm’s identity and building its position in the
global marketplace among customers, retailers and other marketplace participants, makes it
increasingly imperative for firms to establish a clear cut international branding strategy. This study
examines the impact of branding aspects on firm performance in the emerging markets ofSoutheast
Asia. Specifically, the question of standardization versus adaptation of brandpromotion is the focus
of attention. After literature review, a conceptual model suggests that thestandardization of brand
promotion as well as a long-term brand vision provided by management, positively influence target
market performance. Furthermore, the model considers externalenvironmental factors. Data gathered
from a survey with managers allow testing the hypothesesthrough structural equation modelling. The
results of the quantitative study largely support thehypotheses.

Keywords: Branding, Standardization, Performance, Emerging Markets.

INTRODUCTION

The globalization of the marketplace gave rise to the importance of international marketing.
A greatnumber of the well-established theories in marketing are derived from research conducted in
thecontext of advanced markets in highly industrialised countries, which raises the question whether
thesetheories can be applied to the context of emerging markets as well (e.g. Burgess & Steenkamp,
2006; Dawar & Chattopadhyay, 2002; Jaworski & Kohli, 1993). The question of generalisability
across borders and the moderating role of emerging economies characteristics also play an important
role inbrand management, as global branding has become a central issue in international marketing
(Özsomer & Altaras, 2008).

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However, literature notes that even though the academic interest is growing, research in
theinternational branding topic is still not a major concern in international marketing, although it
constitutes a central issue within a company’s overall marketing strategy (Douglas, Craig & Nijssen,
2001; Whitelock & Fastoso, 2007). The topic of international branding has not been clearly
positionedwithin the field of marketing and international marketing, and the term “international
branding” israther defined implicitly than explicitly (Whitelock & Fastoso, 2007). According to
Whitelock and Fastoso (2007), international branding is defined as “a field within international
marketing concernedwith the challenges that companies face when their brands cross national
borders”, naming challengesas brand name, brand visual and sound elements, and brand personality.
A broader definition ofinternational branding is provided by Cheng, Blankson, Wu and Chen (2005),
referring to internationalbranding as “the process of developing a firm’s brand equity that appeals to
overseas target customers’positive attitudes about the brand”.

LITERATURE REVIEW

The standardization/adaptation debate has been a major concern among international
marketingscholars for a long time and it is similarly relevant for international brand management
considerationsin business practice. The advantages of standardizing a firm’s marketing and branding
strategies havebeen frequently named as economies of scale, cost reductions and the creation of a
unique brandimage across countries (Buzzell, 1986; Hassan & Katsanis, 1991; Jain, 1989; Levitt,
1983). However,the stream of research regarding global brands does not come to an agreement as to
how standardizedglobal brands are. The decision of standardizing or adapting a brand is not a
dichotomous one, butrather a question of the extent of standardization or adaptation on a continuum.
National marketcharacteristics and cultural differences have to be taken into consideration (Öszomer
& Altaras, 2008).
As Quelch and Hoff (1986) state, the central issue is not whether to go global but how to
tailor theglobal marketing concept. This holds true for brand management as well, for example when
marketinga product under various brand names or adjusting the product to different markets.
Regarding theelements of the international brand that are to be standardized or adapted, it is often
argued that thecore concept of the brand including the positioning of the brand, brand architecture,
brand personality,brand image and the functional and emotional benefits of the brand should not be
altered. In contrastto this, authors state that the execution of the brand, meaning the detailed
implementation through theaspects of the marketing mix, needs to be adjusted (de Chernatony,
Halliburton & Bernath, 1995). Quelch and Hoff (1986) argue that strategic brand elements are more
easily standardized thanelements that are sensitive to execution. Brand execution is influenced by
moderating factors of theemerging market environment. The main question is whether and how
traditional branding from thedomestic market can be adapted in order to successfully fit into the
context of an emerging market economy (Dawar & Chattopadhyay, 2002).
Previous research in emerging economies often tried to cope with the absence of a Southeast
Asian business environment, (Peng, 2001). A great number of international scholars have adopted an
imperialistmindset, assuming that is only a matter of time that the emerging markets will converge to
advancedmarkets in terms of economic development and consumer behaviour (London & Hart,
2004; Prahalad & Lieberthal, 1998).
Furthermore, many multinational companies focused strongly on the small wealthy segment
inemerging economies, selling to them so-called global products. This strategy neglects
theenormousnumber of consumers at the so-called bottom of the pyramid, who join the market for
the first time (Prahalad& Hart, 2002). Consumers at the bottom of the pyramid are loyal to local
customs and oftenloyal to local brands. Transferring existing products and marketing strategies or
selling outdated Western products to the emerging markets is not regarded as the appropriate way to
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serve the largegroup of consumers at the bottom of the pyramid (Prahalad & Lieberthal, 1998). The
wealthy as wellas the poor consumers in emerging markets need to be catered for by different
strategies (Hart &Milstein, 1999).
Levitt (1983) has noted that a segment within a country is seldom unique. Due to
globalisation, common segments sharing the same characteristics can be identified across countries.
Czinkota, Gaisbauer and Springer (1997) note that due to a differing pace of economic
transformation, Southeast Asia is not a homogeneous market. Therefore, strategies need to be
differentiated across theheterogeneous market and consumer characteristics. However, strategies
focusing on one countryoften pose high costs and may not be the right way serving emerging
markets efficiently. Firms shouldrather consider an “emerging market strategy” with respect to the
commonalities across emerging markets (Dawar & Chattopadhyay, 2002).

CONCEPTUAL MODEL AND HYPOTHESES DEVELOPMENT

Considering the topic of branding in emerging markets, this paper suggests that certain
brandingelements may be standardized in order to achieve superior target market performance.
Particularlybrand promotion bears potential to be standardized due to the appeal of global brands in
emerging markets (Steenkamp, Batra, & Alden 2003).


Figure 1: Conceptual model

Figure 1 proposes that external factors of the emerging market environment, namelymedia
infrastructure and customer homogeneity, drive the standardization of brand promotion in thetarget
market. In this model, the standardization of brand promotion leads to superior performance inthe
emerging target market. Furthermore, the model suggests a positive link between brand vision
andtarget market performance. The following sections explore the links between the constructs as
statedin the literature.

Media infrastructure – promotion standardization link
The availability of promotion infrastructure is a major consideration when determining
theattractiveness of a foreign market (Manrai, Manrai & Lascu, 2001). Özsomer and Simonin (2004)
found a positive relationship between market infrastructure similarity including media availability
andmarketing programme standardization in an emerging market. In developed markets,
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masscommunication through television is used heavily to promote a brand and it is often regarded as
aneconomical way to reach a high number of potential customers. In emerging markets, the situation
canbe different, as mass media might not be similarly available. Dawar and Chattopadhyay (2002)
arguethat personal selling allows more customised and interactive messages than mass media, and it
canalso be more cost efficient in specific situations as it was observed by a company’s launch of a
creditcard in Asia (Rangan, 1997). Media infrastructure can be measured by the availability of
advertisingmedia, encompassing circulation of newspapers, and the number of radio and TV sets
relative to thepeople in the country (Manrai et al. 2001). Additionally, the number of internet
connections should beconsidered. Infrastructure such as telecommunications is often underdeveloped
in emerging markets (Khanna, Palepu & Sinha, 2005). In emerging markets such as the Philippines,
as evidenced by interviews undertaken in connection with the study, the standardization of brand
promotion leads to superior performance by allocating marketing strategies based on dermographics.
Brand promotion when applied to the proper target market and determining their needs according to
their culture, beliefs, age, financial capabilities and media infrastructure will definitely impact on the
success of products being promoted locally and those for exportation (Herrera, 2010). Information
gathered on these data will be the basis for developing the appropriate brand promotion. Therefore,
the following hypothesis is stated:

H1: There is a positive relationship between media infrastructure and the standardization of brand
promotion.

Customer homogeneity – promotion standardization link
Emerging markets are faced with changes in their social systems as they move towards a
marketeconomy. Customers have a strong desire for products and services and the demand potential
for allcategories of products and services is high. But in many countries unemployment is high and
purchasing power varies (Manrai & Manrai, 2001). In their study of consumer products offered
bymultinational companies in less developed countries, Hill and Still (1984) mention factors
causingproduct changes, among them purchasing power differences, socio cultural customs and
taboos, customer preferences and purchasing habits. Even as emerging market customers become
moreaffluent over time, it is not at all certain whether their preferences will converge into a
worldwideconsumption pattern. However, due to globalization some segments may be homogenous
across advanced as well as in emerging markets:

H2: There is a positive relationship between customer homogeneity and the standardization of brand
promotion.

Promotion standardization – performance link
The empirical findings on the standardization/adaptation question are inconsistent. A positive
effect ofmarketing programme standardization on target market performance is shown in several
studies (Özsomer & Simonin 2004; Zou & Cavusgil, 2002), whereas other studies reveal a
positiverelationship between marketing mix adaptation and performance in the target market
(Calantone, Cavusgil, Schmidt & Shin, 2004; Cavusgil & Zou, 1994; Cooper & Kleinschmidt, 1985).
Somestudies find no evidence for a relationship between adaptation and target market performance
(O’Cass & Julian, 2003; Samiee & Roth, 1992). Performance may include objective as well as
subjectiveaspects such as sales volume, growth rate, profitability and success perceived by
management (Cavusgil & Zou, 1994; Samiee & Roth, 1992). This study suggests a positive effect of
brandpromotion standardization on target market performance:

H3: The standardization of brand promotion positively influences target market performance.
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Brand vision – Performance link
A brand oriented-approach encompasses being impassioned and seeing the brand as a
missionand a vision. The concept of brand orientation includes the concept of brand vision which
canbe defined as “a projection of the brand out into the future”, answering the question what canbe
achieved with the brand and highlighting the strategic aspect of brand management (Urde,1999). The
attitude of top management plays an important role in this concept. In a more recent study, Wong
and Merrilees (2008) found a significant influence of brand orientation on brand performance as well
as a positive relationship between brand performance and financial performance. Therefore, this
study hypothesizes a direct relationship between brand vision and performance:

H4: Brand vision provided by management positively influences target market performance.

METHODOLOGY AND RESULTS

Results of the qualitative pre-study
After the development of the research propositions out of the literature review, this study
takes a twostage approach. At first, qualitative in-depth interviews with Philippine managers doing
business in theemerging markets of Southeast Asia provide insight into the problem dimensions of
thetopic. The managers were asked about the branding programmes of their firm in their most
important Southeast Asian target markets. The interviews were recorded, transcribed and analysed.
Categories were built for content analysis, andthey describe the problem dimensions of the topic. The
interviews were analysed in a step-by-stepapproach according to previously established categories
(Mayring & Brunner 2007).
The analysis of the interviews revealed that environmental factors play an important role for
brandingprogrammes in the foreign target market. Although Southeast Asian countries share
commonalities, each country in the region has to be considered individually. In general,
theenvironmental factors are seen as rather stable. Regarding media infrastructure, the
intervieweesmentioned a high usage of television and the internet, which makes it possible to
standardize communication activities. However, differences in the media availability within a
country have to beconsidered, particularly in urban versus rural areas. Thus, careful analysis of the
media infrastructureis suggested. Although purchasing power is comparatively low in Southeast
Asia, the desirability of Western products and brands is high according to the interviewees. The
conclusion isthat at least in some segments, customer homogeneity exists and therefore brand
promotionstandardization is feasible. The interviewees confirmed that they employ a standardized
brandingprogramme in terms of promotion. One of the few exceptions from standardization was
keeping astrong local brand name after the acquisition of a local competitor. The interviewees stated
thatstandardization is a key performance driver in the emerging target market, and they highlighted
theimportance of a managerial brand vision. Hence, the qualitative interviews support the
conceptualmodel to a great extent. In a second step, the hypotheses suggested in the conceptual
model are testedthrough structural equation modelling using PLS (Partial Least Squares). The data
were gatheredthrough a quantitative survey among Philippine managers with business operations in
Southeast Asia.

Construct measurement
The constructs of the survey were measured by existing scales that had previously been
validated inthe literature. All constructs were measured using 5-point Likert scales anchored by
“strongly agree”and “strongly disagree”. Furthermore, the scales were pretested among researchers
in academia andbusiness practitioners with international experience. In this study, reflective
measurement models wereapplied, i.e. that observed variables are interchangeable manifestations of
International Journal of Management (IJM), ISSN 0976 – 6502(Print), ISSN 0976 - 6510(Online),
Volume 5, Issue 7, July (2014), pp. 01-15 © IAEME
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the underlying construct (Bagozzi & Baumgartner 1994). Although literature lists certain decision
criteria, the decision whetherthe measurement model is reflective or formative remains highly
subjective (Homburg & Klarmann 2006), as it is difficult to objectively determine the direction of
causality from construct to measure(Edwards & Bagozzi 2000). Hence it is problematic to talk about
misspecifications as formative orreflective measurement models (Homburg & Klarmann 2006).
However, Table 1 shows the empirical and theoretical considerations of the formative and reflective
measurement models. (Coltman, 2008)

Table 1
Considerations Reflective model Formative model Relevant
literature
Theoretical
Considerations
1. Nature of
Construct

• Latent construct is
existing
• Latent construct
exists independent of
the
measures used

• Latent construct is
formed
• Latent constructs is
determined as a
combination of its
indicators

Borsboom et al.
(2003, 2004)
Direction of
causality
between
items and
latent
construct
• Causality from
construct to items
• Variation in the
construct causes
variation in the item
measures
• Variation in item
measures does not
cause variation in the
construct
• Causality from items
to construct
• Variation in the
construct does not
cause variation in the
item measures
• Variation in item
measures causes
variation in the
construct
Bollen and
Lennox (1991);
Edwards and
Bagozzi (2000);
Rossiter
(2002); Jarvis et
al. (2003)
Characteristics
of items used
to measure the
construct
• Items are manifested
by the construct
• Items share a
common theme
• Items are
interchangeable
• Adding or dropping
an item does not
change the conceptual
domain of the
construct
• Items define the
construct
• Items need not share a
common theme
• Items are not
interchangeable
• Adding or dropping
an item may change
the conceptual
domain of the
construct
Rossiter (2002) ;
Jarvis et al.
(2003)
Empirical
Considerations
4. Item
Intercorrelation

• Items should have
high positive
intercorrelations
• Empirical test:
internal consistency
andreliability
assessed via
Cronbach alpha,

• Items can have any
pattern of
intercorrelation but
should possess the
same directional
relationship
• Empirical test:
indicator reliability

Cronbach
(1951);
Nunnally and
Bernstein
(1994);
Churchill
(1979);
Diamantopoulos
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average variance
extracted, and factor
loadings (e.g., from
common or
confirmatory factor
analysis)
cannot be assessed
empirically; various
preliminary analyses
are useful to check
directionality between
items and construct
and Siguaw
(2006)
5. Item
relationships
with construct
antecedents
and
consequences
• Items have similar
sign and significance
of relationships with
the
antecedents/conseque
nces as the construct
• Empirical test:
content validity is
established based on
theoretical
considerations, and
assessed empirically
via convergent and
discriminant validity
• Items may not have
similar significance of
relationships with the
antecedents/conseque
nces as the construct
• Empirical test:
nomological validity
can be assessed
empirically using a
MIMIC model, and/or
structural linkage
with another criterion
variable
Bollen and
Lennox (1991);
Diamantopoulos
and Winklhofer
(2001);
Diamantopoulos
and Siguaw
(2006)
6.
Measurement
error and
collinearity
• Error term in items
can be identified
• Empirical test:
common factor
analysis can be used
to identify and extract
out measurement
error
• Error term cannot be
identified if the
formative
measurement model
is estimated in
isolation
• Empirical test:
vanishing tetrad test
can be used to
determine if the
formative items
behave as predicted
• Collinearity should be
ruled out by standard
diagnostics such as
the condition index
Bollen and Ting
(2000);
Diamantopoulos
(2006)

The media infrastructure measure consists of four items established by Okazaki, Taylor and
Doh(2007). The respondents were asked to assess the target market regarding the availability of
similaradvertising media, the possibility to conduct similar market research studies, the similarity of
mediacosts and the availability of advertising agencies with international networks. Customer
homogeneitywas measured by four items also established by Okazaki, Taylor and Doh (2007). The
constructincludes the assessment of customer similarity between home and target market, the appeal
to similartarget segments in the foreign market, the similarity of lifestyle between the home and the
foreignmarket, and finally the similarity of customers’ tastes and habits in the foreign market. Brand
visionwas measured according to Vallaster and de Chernatony (2005). Respondents were asked to
assess towhat extent the brand stands for a core set of values, whether the purpose of the brand was
welldefined and whether the future direction of the brand was clear. The construct of
promotionstandardization was measured by two items as suggested by Zou and Cavusgil (2002).
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First, the similar execution of advertising in the home and the foreign market was assessed by the
respondents, second they were asked to state to what extent they used similar techniques for sales
promotion in thehome market and the foreign market. Finally, the measurement of the performance
construct wasadapted from the EXPERF scale by Zou, Taylor and Osland (1998). They
conceptualize performanceas a three-dimensional construct depicting financial performance,
strategic performance andsatisfaction with performance. The original number of nine items to
measure the construct wasreduced to five items in this study in order to avoid a lengthy
questionnaire. Four items with lowerstandardized item-loading were left out, and the five items with
the highest standardized item loadingwere used in this study. Hence, respondents were asked to
assess the profitability and the generation ofa high sales volume in the foreign market regarding
financial performance. Concerning strategicperformance, respondents assessed the improvement of
the strategic position and the increase of themarket share in their main target market. Finally, the
extent to which the performance has beensatisfactory was evaluated by the respondents.

Results of the quantitative study using PLS path modelling
In order to test the hypotheses, a quantitative study among Philippine managers was
conducted in September, 2012 drawing upon the database of the Philippines Chamber of Commerce.
The questionnaire has been pretested among academics and international marketing practitioners
likewise to ensure technical usability and conceptual correctness. A small number of questionnaires
had to beremoved as they referred to target markets that were not relevant for this study, e.g.
Singapore. Theonline survey yielded a total of 153 usable responses. As the questions were all
declared as mandatoryin order be able to move on to the next question, the problem of missing
values was not an issue in thisstudy.
For data analysis, this study employed PLS (partial least squares) path modelling using
SmartPLS 2.0(Ringle, Wende& Will, 2005). The application of PLS is feasible as the sample size is
comparativelylow and a LISREL approach would not make sense, as the minimum recommendation
for LISREL is200. The robustness of model estimations even with smaller sample sizes is a clear
advantage of PLS.Furthermore, PLS does not rely on distributional assumptions (Chin, 1998). A rule
of thumb suggeststhat a sample analysed by PLS should be at least ten times larger than the largest
number of exogenousconstructs that load on one endogenous construct (Chin & Newsted, 1999).
Thus, the minimumsample size required in this study is far exceeded by the sample consisting of 153
responses.
The evaluation of the PLS path model results does not provide a global goodness-of-fit
criterion. Thus, the evaluation of the measurement model and the evaluation of the structural model
both determine thequality of the model. The assessment of the reflective measurement model
includes compositereliability, indicator reliability, average variance extracted (AVE), and cross-
loadings (Henseler, Ringle & Sinkovics, 2009). Composite reliability is a measure of internal
consistency, and the valuesmust not be lower than 0.6 (Henseler et al., 2009). Table 2 shows that all
values are above the threshold:

Table 2: Composite reliability
Variable Composite Reliability
Brand Vision 0.93
Customer homogeneity 0.91
Media infrastructure 0.83
Promotion standardization 0.87
Performance 0.93
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In terms of indicator reliability, the absolute standardized outer loadings should be above
0.7(Henseler et al., 2009), which is met by all indicators of the model except one:

Table 3: Indicator reliability
Variable Indicator Reliability
Media infrastructure 0.80 / 0.83 / 0.50 / 0.79
Customer homogeneity 0.88 / 0. 81 / 0.87 / 0.84
Brand vision 0.91 / 0.91 / 0.88
Promotion standardization 0.89 / 0.87
Performance 0.75/ 0.85 / 0.91 / 0.84 / 0.87

As shown in the Table 3, one indicator of the media infrastructure construct is below 0.7
However,the recommendation to eliminate reflective indicators from the model refers to values
below 0.4 (Henseler et al., 2009). As the value of the indicator in question is 0.5, the indicator is not
eliminatedfrom the model.
Proceeding to the next step in the assessment of the measurement model, the average
varianceextracted (AVE) should be higher than 0.5 (Henseler et al., 2009), which is met by all values
of the model:

Table 4: Average variance extracted
Construct AVE
Media infrastructure 0.56
Customer homogeneity 0.72
Brand Vision 0.82
Promotion standardization 0.77
Performance 0.71

Finally, the assessment of the measurement model encompasses the examination of the cross-
loadingsin order to account for discriminant validity:

Table 5: Cross-loadings
Brand vision Customer
homogeneity
Media
infrastructure
Performance Promotion
standardization
BVISION1 0.91 0.06 0.33 0.37 0.27
BVISION2 0.91 0.04 0.34 0.29 0.28
BVISION3 0.88 0.11 0.30 0.24 0.19
CUSTHOMO1 -0.05 0.88 0.19 0.30 0.22
CUSTHOMO2 0.06 0.81 0.13 0.17 0.17
CUSTHOMO3 0.08 0.87 0.24 0.22 0.24
CUSTHOMO4 0.17 0.84 0.16 0.28 0.20
MINFRA1 0.39 0.12 0.80 0.33 0.52
MINFRA2 0.21 0.19 0.83 0.26 0.54
MINFRA3 0.17 0.16 0.50 0.07 0.28
MINFRA4 0.28 0.19 0.80 0.22 0.58
PERF1 0.13 0.34 0.23 0.75 0.25
PERF2 0.21 0.18 0.20 0.85 0.31
PERF3 0.38 0.23 0.33 0.91 0.36
PERF4 0.40 0.24 0.27 0.84 0.33
PERF5 0.23 0.25 0.26 0.87 0.29
PSTAND1 0.21 0.14 0.39 0.23 0.89
PSTAND2 0.27 0.31 0.47 0.43 0.87
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In summary, it can be stated that the evaluation of the measurement model has yielded
reliable andvalid model estimations. Therefore, the structural model can be assessed in the next step
through R² ofendogenous variables and estimates for path coefficients. The coefficient of
determination (R²) of theendogenous latent variables describes the structural model. Values above
0.67, 0.33, or 0.19 forendogenous latent variables in PLS path models are regarded as substantial,
moderate or weak (Chin1998). If a structural model explains an endogenous latent variable by only
one or two exogenouslatent variables, a lower threshold for R² values is acceptable (Henseler et al.,
2009).

Table 6: R² of endogenous variables
Endogenous variable R²
Promotion standardization 0.46
Performance 0.20

Table 6 shows that the R² values obtained from the PLS path model are moderate for
promotionstandardization and weak for performance. As performance is influenced by a number of
other factorsthat have not been considered in this model, the rather low R² value has to be regarded
as acceptablecompared to other studies in this research field (e.g. Sichtmann & van Selasinsky,
2010).
Path coefficients of the structural model are evaluated according to sign, magnitude and
significance.The latter is determined via the bootstrapping procedure. The sign of the structural paths
should be inline with previously postulated signs. The threshold for substantial relationships is 0.2.
Values below 0.2 are further clarified through bootstrapping which provides additional information
and proof. Here, bootstrapping is conducted with 5000 subsamples and a student’s t-test is
performed. The threshold forthe empirical t-value is 1.965 at a significance level of 95%, values that
are higher are regarded as significant (Henseler et al., 2009):

Table 7: Path coefficients and t-values
Relationship Path
coefficient
Empirical t-
value
Significance
H1: Media infrastructure =>
promotion standardization

0.64 9.45 Significant
H2: Customer homogeneity
=>
promotion standardization

0.11 1.71
Not
significant
H3: Promotion
standardization
=> performance

0.30 3.47 Significant
H4: Brand vision =>
performance
0.26 4.20 Significant

The analysis of the structural model reveals that three hypotheses (H1, H3, H4) can be
supported.Media infrastructure has a positive and significant influence on the standardization of
brand promotionactivities in the South East Asian target market. The standardization of
brandpromotion in turn has a significant impact on firm performance in the foreign target market,
whichsupports the standardization perspective in international marketing literature. Finally, brand
International Journal of Management (IJM), ISSN 0976 – 6502(Print), ISSN 0976 - 6510(Online),
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visionprovided by top management has a positive and significant influence on firm performance in
the Southeast Asian target market. The hypothesized relationship between customerhomogeneity and
promotion standardization could not be supported in this study.

DISCUSSION AND IMPLICATIONS

In the international marketing literature there has been a long debate on the question of
standardizationversus adaptation of marketing activities. Previous studies on the performance effects
ofstandardization/adaptation of marketing and branding programmes have yielded mixed results.
Thefindings of this study add to the existing body of literature by supporting the view of
positivestandardization effects on firm performance in the foreign target market. Furthermore, a large
numberof studies have focused on the context of advanced markets such as the US, Western Europe
or Japan, whereas emerging markets have been largely neglected. By considering the foreign target
markets ofSoutheast Asia, this study takes into account the emerging markets context.
This study considers media infrastructure and customer homogeneity as antecedents of
brandpromotion standardization. Media infrastructure plays a crucial role in emerging markets, as it
is oftennot as developed as in advanced markets. The positive influence of media infrastructure on
brandpromotion standardization in the markets of Southeast Asia highlights the importance ofmedia
infrastructure availability. Thus, a managerial implication resulting from this significantrelationship
is to carefully consider the existing media infrastructure in the foreign target markets ofSoutheast
Asia.Although there is a potential for standardizing brand promotion keep in mind that itis not a
homogenous region. Differences in the development of the infrastructure do exist, and eachcountry
has to be examined separately.
The rationale for choosing customer homogeneity as antecedent for promotion
standardization goesback to the question of the existence of the Asian customer and the conversion
of tastes over time.The relationship between customer homogeneity and brand promotion
standardization turned out to benon-significant. As mentioned above, Southeast Asia is not a
homogenous region andeach country has to be examined separately before market entry. Some
countries may sharecommonalities with other emerging markets or with other advanced markets.
Therefore, brandpromotion standardization may not be feasible under each circumstance in the
context of the emergingmarkets of Southeast Asia.
The results of this study support the positive impact of brand promotion standardization on
firmperformance in the foreign target market. Given the complex environment of the firm and the
highnumber of factors contributing to the international success of the firm, the conclusion is that the
effectsof brand promotion standardization are substantial. Thus, a standardized approach towards
brandpromotion at least to a certain extent is recommended for the emerging markets of Southeast
Asia. Cost savings and economies of scale associated with standardization, as previously suggestedin
the international marketing literature, are supported for the emerging markets of Southeast Asia.
Thus, basic assumptions derived from research mainly conducted in advanced markets holdtrue for
the context of emerging markets as well. This study therefore adds to the question oftransferability of
traditional marketing theories and concepts from advanced markets to emergingmarkets.
Finally, the results of this study contribute to branding research in international marketing. So
far,international branding is still under-researched in the marketing and international business
literature (Whitelock & Fastoso, 2007). This applies even more to the research setting of emerging
markets suchas Southeast Asia. The positive and significant effect of brand vision on firm
performancehighlights the role of top management for a successful brand management leading to an
increasedperformance of the firm in the foreign target market. Thus, firms and their managers are
encouraged toestablish and actively live the vision of their brand. Top managers may act as role
models conveyingthe values of the brand to their employees and customers likewise. In international
International Journal of Management (IJM), ISSN 0976 – 6502(Print), ISSN 0976 - 6510(Online),
Volume 5, Issue 7, July (2014), pp. 01-15 © IAEME
12

businessoperations, the vision of the brand can serve as a common anchor across countries and
cultures.

LIMITATIONS AND DIRECTIONS FOR FUTURE RESEARCH

Some limitations of this study result from the conceptual focus and the research design that
led totrade-off decisions in some areas. First of all, the variables examined cover only a small part of
thecomplex international environment of the firm. The number of potential sources that have an
influenceon standardization and performance is high. Thus, the conceptual model of this study
depicts a highlyspecific area of investigation. A number of alternative conceptual models including
other variables andantecedents in terms with respect to the branding topic would be feasible.
Another limitation lies in the empirical context in which the study was conducted. The study
focusedon managers of Philippine firms doing business in the emerging markets of Southeast
Asia.Generalisations of the findings should be made with caution, as the institutional context of
Southeast Asian countries might differ from other emerging markets such as India, China or Brazil.In
these markets, the relationships that were supported in the model of this study may turn out to
bedifferent. The hypotheses that were supported in this study might not hold in other empirical
settings.
Thus, further research should incorporate different countries or regions in an emerging
market context.The research design took the form of a cross-sectional study covering a broad range
of industries.However, in future research it would be important to also conduct longitudinal studies
on the topic ofstandardization and firm performance to support the generalisability of the results.
Another avenue forfuture research would be a sector-specific approach. Furthermore, a key
informant was asked in eachfirm to elicit his or her perceptions of the variables in question. Future
studies could include multipleinformants of one firm or objective data to triangulate the answers.
Regarding the measurement of the constructs, this study relied on scales that have already
been used inempirical research and published in high-quality academic journals. In the case of brand
promotionstandardization, this resulted in a measurement with fewer than three items. Although this
scalereceives support in the literature, a greater number of items would be desirable with respect
toincreased reliability in future studies on the topic. Another limitation lies in the use of PLS for
modelestimation and for testing the hypotheses. As PLS does not allow testing the overall fit of the
model, future studies could rely on covariance based structural modelling using for example LISREL
orAMOS.

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