Corporate brand reputation and the adoption of innovations
| Pages | 242-250 |
| Published date | 17 July 2009 |
| Date | 17 July 2009 |
| DOI | https://doi.org/10.1108/10610420910972765 |
| Author | David Corkindale,Marcus Belder |
| Subject Matter | Marketing |
Corporate brand reputation and the adoption
of innovations
David Corkindale
The University of South Australia, Adelaide, Australia
Marcus Belder
Chronologic Pty Ltd, Adelaide, Australia
Abstract
Purpose – This paper aims to investigate how the strength of a corporate brand influences the adoption of an innovative service, and the main
components of the construct: corporate brand (CB).
Design/methodology/approach – A real-world, online, information acceleration experiment was conducted where the marketing mix and
competitive environment was held constant for a new service from three different CBs. Respondents indicated their likelihood of buying from each of
these and their perceptions of them.
Findings – The study finds that there was a significant relationship between CB strength and respondents’ likelihood of adoption of the service. The CB
construct was found to comprise two factors: conative and cognitive, where the former was more influential on adoption probability.
Research limitations/implications – A limited set of variables commonly associated with brands was taken to be representative of CB. Further
research would be needed to more generalise the findings and more fully examine the CB construct for its components.
Practical implications – A competent marketing mix is not sufficient on its own to gain the adoption of an innovative service: a strong CB is
influential. The emotive rather than factual associations with the CB may well be a more influential on adoption decisions.
Originality/value – An indication of the scale of the CB effect on innovation adoption is given. CB is indicated to have two components: emotive and
factual. Those managing the potential launch of an innovative service and who may have several corporate brands to choose from to use would be
aided by this research.
Keywords Corporate branding, Innovation, Information strategy, Internet shopping, Purchasing
Paper type Research paper
An executive summary for managers and executive
readers can be found at the end of this article.
Introduction
If you lose dollars for the firm by a bad decision I will be very understanding.
If you lose reputation for the firm, I will be ruthless (advice Warren Buffet,
the famed US investor, gives to managers of firms in which he has invested).
The above quotation emphasises the importance attached to
the corporate reputation of an existing fir m. How important is
it to a new firm and one that is attempting to have an
innovative product or service adopted in the market place?
As much as 46 per cent of all resources in the USA devoted to
product development are spent on products that are cancelled
or fail to yield adequate financial returns (Sivadas and Dwyer,
2000). Research that can illuminate reasons for such failure
and avoid it in future would seem a worthy endeavour. The
premise that this research investigates is that innovative
products, particularly those from small or start-up firms, can
fail to be adopted in the marketplace because such firms may
lack a sufficient corporate reputation among the potential
clients. The aim of the research that is reported here was to
produce evidence to test this premise.
First, the literature on corporate reputation and corporate
brand is briefly reviewed to identify the relationship between
them. Next evidence for the effect these may have on the
adoption of innovative products by consumers in a
marketplace is summarised. The paper then sets out the
research questions that were subsequently examined. The
methodology employed is then described, which includes the
formulation of the research model, the extensive data
collection experiment, the analysis, the findings and finally
the discussion of these findings.
Literature review
Corporate reputation and brands
Reputation has been recognised as one of the key foundations
on which to build corporate success (Key, 1995) and a
valuable, critically intangible asset (Dolphin, 2004). Vercic
and Vercic (2007) make the distinction between reputation
and brand with the latter being a customer-centric concept
that represents the implicit promise that a company makes to
its customers about a specific product or service. A company’s
reputation is company-centric, they suggest, and is focussed
on the credibility and respect that the company has among a
range of stakeholders and is supported by Logsdon and Wood
(2002). This suggests that brand is about relevancy to
customers whereas reputation is about legitimacy of the
organisation with respect to the stakeholders. The conclusion
is that reputation is a necessary but not sufficient condition
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1061-0421.htm
Journal of Product & Brand Management
18/4 (2009) 242–250
qEmerald Group Publishing Limited [ISSN 1061-0421]
[DOI 10.1108/10610420910972765]
242
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