Strategy Changes, Flexibility and Brand Management

Brand management of companies has to maintain flexibility to be successful in an environment, which is characterized by changing technologies, changing consumer needs, organizational changes, and a changing competitive environment. The state-of-the-art brand management approach, which explicitly views brand management as continuous task considering a feedback loop in the brand management process, is identity-based brand management. In context of flexibility and change in brand management there are two challenges companies have to overcome to adapt successfully. The first challenge is related to the component and the level of change in brand identity. The first question to answer in this context is which component of the brand identity can be changed without damaging it. While the core of the brand identity, i.e. essential identity components, must not be changed, the periphery of the brand identity, i.e. nonessential identity components, can be changed. The second question to answer in this context is how much a brand identity can be changed without damaging it. Overall, the level of brand identity change must not be too radical because customers cannot connect the new brand identity with their current brand image if the change is too radical. The case study of FRoSTA illustrates this first challenge of dynamic brand management: Radical changes of the brand identity especially regarding essential identity components can lead to economic failures. The second challenge is related to the internal implementation of the brand, its identity, and change of the identity. The question to answer is how the brand identity and subsequent changes of the brand identity can be communicated to employees as internal stakeholders responsible for living the brand and for communicating the change to external stakeholders. In order to implement the brand within the organization companies have to engage in internal brand management (IBM), which is a concept that implements the brand cognitively (brand understanding), affectively (brand commitment), and behaviorally (brand citizenship behavior) at employee level. Managerial tools to implement the brand within the organization are internal and external brand communication, brand-oriented leadership, and brand-oriented human resource management. The case studies show that companies engaging in these activities are able to create strong brands and competitive advantages.