IDEAS home Printed from https://ideas.repec.org/a/spr/futbus/v9y2023i1d10.1186_s43093-023-00196-2.html
   My bibliography  Save this article

The effect of investment in the brand value chain on profitability and market value of the firm: lesson of success taken from Amazon

Author

Listed:
  • Raghda Abdellatif Abdelkhalik Elsayed

    (Al-Azhar University)

Abstract

This study aims to contribute to the existing business strategy literature by exploring how brand-building activities contribute to the firm's value by analyzing the direct and indirect effect of investment in the brand value chain on brand resonance, profitability, and market value. This study is based on a random sample of 237 Certified European Financial Analysts and a questionnaire was employed. Harman’s single-factor test was conducted to define the presence of common method bias. Hayes Process Macro Model 5 was used to check the multiple mediation processes and indirect effects between the study's variables. The study employs the financial statements of Amazon.com, Inc. from 2010 to 2021 which has been analyzed under the standard multiple regression model. The study results reveal that Harman’s single-factor test extracts 10.397% of the total variance. On the other hand, there are significant positive relationships between the effect of investment in the brand value chain on brand resonance, profitability, and market value. The empirical evidence of this study provides an opportunity to learn about the effect of the investment in the brand value chain leads to increase brand equity which builds up in the customers' mindset and then transforms to market performance and profitability. The findings of this study can be a useful reference for future studies in academic research related to strategic thinking to maximize profitability and market value through the brand value chain.

Suggested Citation

  • Raghda Abdellatif Abdelkhalik Elsayed, 2023. "The effect of investment in the brand value chain on profitability and market value of the firm: lesson of success taken from Amazon," Future Business Journal, Springer, vol. 9(1), pages 1-17, December.
    • Handle: RePEc:spr:futbus:v:9:y:2023:i:1:d:10.1186_s43093-023-00196-2
    DOI: 10.1186/s43093-023-00196-2
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1186/s43093-023-00196-2
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1186/s43093-023-00196-2?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Umesh Ramchandra Raut & Pedro Quelhas Brito & Prafulla Arjun Pawar, 2020. "Analysis of Brand Resonance Measures to Access, Dimensionality, Reliability and Validity," Global Business Review, International Management Institute, vol. 21(1), pages 162-175, February.
    2. Johansson, Johny K. & Dimofte, Claudiu V. & Mazvancheryl, Sanal K., 2012. "The performance of global brands in the 2008 financial crisis: A test of two brand value measures," International Journal of Research in Marketing, Elsevier, vol. 29(3), pages 235-245.
    3. Bayer, Emanuel & Srinivasan, Shuba & Riedl, Edward J. & Skiera, Bernd, 2020. "The impact of online display advertising and paid search advertising relative to offline advertising on firm performance and firm value," International Journal of Research in Marketing, Elsevier, vol. 37(4), pages 789-804.
    4. Fischer, Marc & Himme, Alexander, 2017. "The financial brand value chain: How brand investments contribute to the financial health of firms," International Journal of Research in Marketing, Elsevier, vol. 34(1), pages 137-153.
    5. Anselmsson, Johan & Bondesson, Niklas, 2015. "Brand value chain in practise; the relationship between mindset and market performance metrics: A study of the Swedish market for FMCG," Journal of Retailing and Consumer Services, Elsevier, vol. 25(C), pages 58-70.
    6. Musaab Mousa & Saeed Nosratabadi & Judit Sagi & Amir Mosavi, 2021. "The Effect of Marketing Investment on Firm Value and Systematic Risk," Papers 2104.14301, arXiv.org.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Eunkyung Lee & Ji-Hern Kim & Chang Seop Rhee, 2021. "Effects of Marketing Decisions on Brand Equity and Franchise Performance," Sustainability, MDPI, vol. 13(6), pages 1-15, March.
    2. Rajesh Kumar Bhaskaran & Koyilathumpaday Sukumaran Sujit & Kareem Abdul Waheed, 2023. "Linkage Between Brand Value and Firm Performance: An Empirical Examination Using Fuzzy Set Qualitative Comparative Analysis," SAGE Open, , vol. 13(3), pages 21582440231, August.
    3. Vanitha Swaminathan & Sayan Gupta & Kevin Lane Keller & Donald Lehmann, 2022. "Brand actions and financial consequences: a review of key findings and directions for future research," Journal of the Academy of Marketing Science, Springer, vol. 50(4), pages 639-664, July.
    4. Anselmsson, Johan & Burt, Steve & Tunca, Burak, 2017. "An integrated retailer image and brand equity framework: Re-examining, extending, and restructuring retailer brand equity," Journal of Retailing and Consumer Services, Elsevier, vol. 38(C), pages 194-203.
    5. Ian Ruthven, 2021. "Resonance and the experience of relevance," Journal of the Association for Information Science & Technology, Association for Information Science & Technology, vol. 72(5), pages 554-569, May.
    6. Mahabubur Rahman & M. Ángeles Rodríguez-Serrano & Mary Lambkin, 2019. "Brand equity and firm performance: the complementary role of corporate social responsibility," Journal of Brand Management, Palgrave Macmillan, vol. 26(6), pages 691-704, November.
    7. Anne Schmitz & Nieves Villaseñor-Román, 2018. "Do Brands Matter in Unlisted Firms? An Empirical Study of the Association between Brand Equity and Financial Performance," Administrative Sciences, MDPI, vol. 8(4), pages 1-12, October.
    8. Xuan Gong & Yunchan Zhu & Rizwan Ali & Ruijin Guo, 2019. "Capturing Associations and Sustainable Competitiveness of Brands from Social Tags," Sustainability, MDPI, vol. 11(6), pages 1-20, March.
    9. Erik Syawal Alghifari & Ardi Gunardi & Jaja Suteja & Indah Khoerun Nisa & Zalfa Amarananda, 2022. "Investment Decisions of Energy Sector Companies on the Indonesia Stock Exchange: Theory and Evidence," International Journal of Energy Economics and Policy, Econjournals, vol. 12(6), pages 73-79, November.
    10. Huang, Yuxuan & Yang, Shenggang & Zhu, Qi, 2021. "Brand equity and the Covid-19 stock market crash: Evidence from U.S. listed firms," Finance Research Letters, Elsevier, vol. 43(C).
    11. Worm, Stefan & Srivastava, Rajendra K., 2014. "Impact of component supplier branding on profitability," International Journal of Research in Marketing, Elsevier, vol. 31(4), pages 409-424.
    12. Vasu Unnava & Ashwin Aravindakshan, 2021. "How does consumer engagement evolve when brands post across multiple social media?," Journal of the Academy of Marketing Science, Springer, vol. 49(5), pages 864-881, September.
    13. Butschek, Sebastian & González Amor, Roberto & Kampkötter, Patrick & Sliwka, Dirk, 2022. "Motivating gig workers – evidence from a field experiment," Labour Economics, Elsevier, vol. 75(C).
    14. Pedro Antonio Martín-Cervantes & María del Carmen Valls Martínez, 2023. "Unraveling the relationship between betas and ESG scores through the Random Forests methodology," Risk Management, Palgrave Macmillan, vol. 25(3), pages 1-29, September.
    15. Agarwal, Manoj K. & Ma, Zecong & Park, Chang Hee & Zheng, Yilong, 2022. "The impact of a manufacturer’s financial liquidity on its market strategies and pricing and promotion decisions in retail grocery markets," Journal of Business Research, Elsevier, vol. 142(C), pages 844-857.
    16. Wilhelmus Hary Susilo & Yan Pieter Mulia Hutabarat & Otto Bustani, 2019. "The Pursuit for Brand Usage Intent: Insight in Higher Education which Used the Compatible Computer," International Review of Management and Marketing, Econjournals, vol. 9(5), pages 125-132.
    17. Luyao Wang & Hong Fan & Tianren Gong, 2018. "The Consumer Demand Estimating and Purchasing Strategies Optimizing of FMCG Retailers Based on Geographic Methods," Sustainability, MDPI, vol. 10(2), pages 1-17, February.
    18. Sarimehmet, Ayse Sarimehmet & Aydin, Samet, 2021. "Branding Of Private Label Products By Product Category: A Model Suggestion For Fmcg Market," UTMS Journal of Economics, University of Tourism and Management, Skopje, Macedonia, vol. 12(1), pages 19-31.
    19. Xiuzhi Zhang & Ying Zhang & Zhijie Lin, 2023. "Online Advertising and Real Estate sales: evidence from the Housing Market," Electronic Commerce Research, Springer, vol. 23(1), pages 605-622, March.
    20. Nguyen, Bang & Yu, Xiaoyu & Melewar, T.C. & Gupta, Suraksha, 2016. "Critical brand innovation factors (CBIF): Understanding innovation and market performance in the Chinese high-tech service industry," Journal of Business Research, Elsevier, vol. 69(7), pages 2471-2479.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:futbus:v:9:y:2023:i:1:d:10.1186_s43093-023-00196-2. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.