Edited by Subhash C. Jain
Chapter 14: Global Brands: Does Familiarity Breed Contempt?
Johny K. Johansson and Ilkka A. Ronkainen INTRODUCTION The recent recognition of strong brand names as a key competitive asset has led to increased emphasis on the management of a ﬁrm’s top brands. Today strategic marketing management involves leveraging brand portfolios so as to maximize brand strength and ﬁnancial brand equity. Consequently, given the importance of market expansion in the measurement of brand equity, it is not surprising to see that the emphasis on branding has in turn led to an increased stress on creating global brands. Brand management, now also a top management preoccupation, involves strong brand promotions, brand extensions and expansion into new markets, often overseas. Resource constraints in the typical ﬁrm suggest that managers concentrate their eﬀort behind a few top brands, and focus on product categories where the ﬁrm can claim a leadership position. Thus, an international expansion strategy typically involves creating high levels of awareness and a positive image in several markets for a selected few ‘global’ brands. Global brands should be found everywhere, and everyone should know of their existence. However, since brand equity tends to rise with the ‘distinction’ or ‘esteem’ of a brand, an all-out eﬀort to make the brand familiar may not always be the best strategy. As a brand becomes a familiar presence in a market, it may lose its aura of distinction and be perceived more as a commonplace good in the eyes of the customer. For example, it is possible that as people in previously untapped...
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