Building a Consistent Global Brand:
Is it a Must for the Internationalising Born-Globals and SMEs?
By Wilson Chew, Principal Consultant & CEO, StrategiCom
6 Oct 2007

What is a brand? Asking ten people this question will probably get you ten different answers. Yes, there are many definitions of a brand and indeed, the topic of branding (including customer loyalty, product value, identity recall, preference and risk management etc) has been widely researched in the last twenty years, both in the B2B and B2C settings.

A brand is the symbolic embodiment of all the information connected with a product or service. Simply put, a brand typically includes a name, logo, and other visual elements such as images or symbols. It may also encompass the set of expectations and associations in stakeholders’ minds. Such “stakeholders” include employees of the brand owner, people involved with distribution, sale or supply of the product or service, and customers. Some further argue that the legal term for brand is trademark and may identify one or more items, of that seller.

New laws and regulations , the global proliferation of the internet, faster movement of peoples between countries has resulted in global competition. This globalisation of the world economy has led to a dramatic rise in the scope and complexity of international brand management. Many global marketing managers believe that this relational, communal, participatory, sensory, and emotive view of brand relationships is increasingly lifted as a central pillar of market differentiation and sustainable competitive advantage. The author suspects this to be the same for Born-Global Companies (BGC) and Small & Medium Enterprises (SME) which are in the process of internationalization; which is the focus of this article.

Born-Global Companies (BGCs)

A relatively recent phenomenon in Singapore, BGCs seek to derive significant competitive advantage from the use of resources and sale of outputs in multiple countries especially when it experiences a gusher. They engage in international business management and operations from day one of their establishment. It is also observed that BGCs market themselves very differently from common traditional companies. Among the growing amount of research investigating rapidly internationalizing BGCs, most studies focus on the network relationships, knowledge, and resources behind their entrepreneurial behaviour. However there seems to be a lack of studies that focus on the branding of BGCs. The first purpose of this article is to exploit branding concepts found in general and academic literature, with an objective to linking them to the BGC.

Small and Medium Enterprises (SMEs)

The existence of SMEs has a long history with the development of Singapore. Today, more of Singapore's SMEs are no longer the small scale operations of yesteryears. SMEs have also been associated as playing a supporting role to the larger multi-national corporations (MNCs) and larger corporations in Singapore. In addition to being registered with the Accounting and Corporate Regulatory Authority (ACRA), SMEs must have conducted at least 2 full years of operation, have an annual sales/turnover of less than S$80 million and fixed assets of less than S$15 million, less than 200 employees (for non-manufacturing SMEs), have at least 30% Singapore local equity ownership and not be a subsidiary of a Public Listed Company (Group, 2006) . Branding as a philosophy is just as salient for SMEs as for larger ones. Further, where differentiation via product or service superiority alone is increasingly hard, it has particular relevance. It is poorly understood.

Enterprises today: BGCs and SMEs in the small domestic market of Singapore

Singapore is one of the leading economies in the Asia-Pacific region. Along with Hong Kong, Taiwan and South Korea, its economic development in the 1980s and 1990s caught the attention of the world. Today it has a per capita GDP that exceeds that of most countries outside the US. However, its domestic market is small.

A Consistent Brand and Internationalisation

Branding has evolved from being seen simply as the consistent application of strong graphic design into a philosophy and a process of organisational change. With globalisation, liberalization, removal of trade barriers and super-competitiveness in the business environment, branding and brand management have become critical to both competition as well as survival. Globalisation has led to dramatic rises in the scope and complexity of international brand management and achieving global brand consistency across countries is an important theme.

A Critical Assessment

We know that BGCs and SMEs use several different entry modes simultaneously into new markets. It is established that when a BGC or SME delve into the world of international business and management, its brand management has to be consistent. Let us go through five constructs which contribute to global brand consistency (refer to Figure 1). Now this is NOT to say that there aren’t other constructs; certainly there are many such as “marketing communications”, “advertising”, public relations” etc.

The concept of brand is often confused with the linked concept of reputation and therefore, corporate reputation should be visited and explored in the context of internationalisation.

• Construct 1: Corporate Reputation

The core principle in developing, promoting and positioning of a brand should be to focus on enhancement of ‘brand image’ and ‘brand personality.

• Construct 2: Brand Image
• Construct 3: Brand Personality

Brands are functional and emotional values making promises about unique experience. These values are communicated through advertisements and interactions between staff and consumers. Brands exist in the minds and hearts of consumers and are socially constructed through stimuli such as staff behaviour, style of dress and tone of voice. As such, the success of brands depends critically on staff reinforcing the desired values through appropriate behaviour.

• Construct 4: Internal Branding

One of the major driving forces behind economic globalisation has been the internet. Companies which have taken major steps towards internationalising their brands through the internet respond appropriately to the localisation/adaptation challenges that they face online and offline.

• Construct 5: Web Branding

Construct 1: Corporate Reputation

In international business markets where there is a large service component due to the technical nature of the products, the seller’s reputation is an important influence. In sociology, prestige is the preferred term, in accountancy and law, goodwill. Fombrun (1998) defined corporate reputation as “a perceptual representation of a company’s past actions and future prospects describing overall appeal to all of its key constituents when compared with other leading rivals”. As discussed by Brown and Logsdon (1997), the three key points of this definition are that (a) it emphasizes the perceptual nature of the construct; (b) it is a net or aggregate perception by all stakeholders, not just one or two; and (c) it is inherently comparative vis-à-vis some standard.

But what if the BGC has just been born or if an SME is really small? An interesting suggestion holds that cluster reputation could be a potential substitute for the lack of corporate reputation in the case of BGCs and SMEs which lack a reputation of their own. This is in fact widely practised when regional SMEs and BGCs bid for global contracts.

Construct 2: Brand Image

In many papers, brand image is defined as the concept of a brand held by the consumer. It is largely subjective, a perceptual phenomenon formed through interpretation whether reasoned or emotional. It is affected and molded by marketing activities by context variable. Brand image consists of functional and symbolic brand beliefs. So we now know that brand image exists as an image which the customer has of a brand. But does a brand which represents certain perceptions in one country represent the same set of perceptions in another? The fashion retailers tend to categorically state it’s a clear “yes”. But what about BGCs and SMEs? Does this “yes” apply? Critical issues that BGCs should consider includes the positioning of the firm. All organisations need to communicate what they are about to their customers so that a consistent brand image can be brought about.

So we can generally conclude that establishing a relevant brand image is important to the internationalising BGC and SME.

Construct 3: Brand Personality

The concept of brand personality and its influence on behaviour has also emerged as an important issue of concern for academicians as well as practitioners. Brand personality can influence brand processing, brand attitudes and brand loyalty. It is part of the brand image and previously considered to be a co-construction of the firm and its consumers. Because brand owners usually use external agencies to create its marketing communications, the brand identity itself is a co-construction between the brand owner and the creatives within the agency. It is not uncommon for BGCs or SMEs to lack in financial resources compared to MNCs and so while Blythe (2007) argues that brand personalities could be generally created by creative agencies, what if an agency is not used?

Can a brand personality be developed and held consistent when conducting international business without the use of an agency? Possibly this could be done through the personality of the owner/s of the business. Personality (person) brands have developed reputations based on third parties that are not directly relevant to their particular product category, but are widely admired or respected for their professional or personal achievement in other fields. The admiration of such a spokesperson provides the brand with borrowed equity. So, as the “personality” engages in international business, it could well be possible that the BGC or SME’s brand personality is “borrowed”.

The weakness of such a theory is the association between the firm and the personality. If the “brand reputation” of the person is tarnished; it is common sense to assume that the firm’s reputation will be affected.

Construct 4: Internal Branding

Standardisation versus adaptation of brands is widely discussed. Organisational internal brand alignment for BGCs and SMEs bring the brand promise to life. While one has a global business and workforce, it is important for managers of BGCs and SMEs to understand that a brand can reflect the type of relationship that an organisation has with its employees. For this to be successful, staff should be viewed as another vehicle to communicate and manifest the brand so that the organisation can be organised globally to deliver the brand promise through the organisation’s culture, reward systems, activities and structure.

Owners of BGCs and SMEs with international operations must demonstrate their commitment to these values through behaviour as well as corporate communications, demonstrating sincerity. Ideally it should be a top-level responsibility, outside HR and marketing.

Construct 5: Web Branding

In an increasingly digitised information environment, messages about what an organisation or its products and services mean for customers, and the value that they offer, increasingly need to be communicated remotely, through the organisation’s web site. In today's increasingly web oriented business world, if you don't show up in a Google search of your name, you don't exist. BGCs and SMEs must take full advantage of the internet to fulfil their global management and marketing objectives. The consistent and cumulative judgment by the public over time provides the BGC and SME with significant competitive advantages.

Web branding is not without pitfalls. While it is good to have consistency of the brand globally, it is also important to note that in certain markets, localisation is important. One such successful case is HSBC’s brand of being “The World’s Local Bank”. However, how can this be better managed by the internationalising BGC and SME? The trick is to decide what goes global and what goes local. This should be manifested also on the website. BGCs and SMEs can better manage this as their new market penetration activity is relatively easier to manage compared to global MNCs.

Practices in Organisational Settings.

In contemporary practise seen from the author’s personal experience in working with best-in-class SMEs and BGCs managing their international business, senior managers use the following to manage cross-border brand alignment:-

• internal communications to raise employee morale and commitment through universal shared beliefs and vision;
• train country managers and staff in the understanding of the brand promise and the behaviours and values the promise demands; and to adapt their behaviour accordingly;
• train employees in the processes and responsibilities which contribute to delivering the brand promise to customers;
• use company policies, e.g., recruitment, training, rewards, to enhance the organisation to be in line with its brand promise;

The observed result generally tends to show a greater satisfaction for employees leading to employee and customer preference and loyalty.

The weakness associated with such activities is TIME. BGCs and SMEs are predominantly obsessed with survival issues and the leaders within such organisations may be very involved with new business development and leaving little time to the focussing of the above. This is an observed common weakness.

Conclusion

Global branding provides many benefits to the internationalising BGC and SME such as Added Value for customers; lower marketing costs; provision of cross-border learning for universal palatability; and cultural benefits for the company.

In international business, brand management is critical because products and services have become so alike that they fail to distinguish themselves by their quality, efficacy, reliability, assurance and care .

This article has established that the internationalising BGC and SME will benefit from global brand consistency (a business capability in international business management) because customers and staff alike can identify with the brand from a universal perspective. This consistency can be driven by the enterprise’s reputation. It was established that this could be “borrowed” reputation of the personalities of those who lead the business. All organisations (BGCs and SMEs) need to communicate what they are about to their customers and one way of defining this is through a well-managed and consistent brand image. Internal alignment of people also contributes to international business management of the BGC and the SME. This perhaps is most important since in most cases, the owners of such enterprises could be very involved with the day-to-day running of the business and neglect may set in. Being small also provides the advantage of internal alignment because the management of people could be a lot easier as such firms tend to be smaller in size. Brand consistency can also be achieved by leveraging on the internet. The internet can be the “platform” of messaging for the aligning of perception both internally and externally.

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