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Trends in packaging claims for new products : impacts on firm value

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  • Martínez Ros, Ester
  • Lado Couste, Nora Rita
  • Martos Partal, Mª de las Mercedes

Abstract

An important reason why individuals join groups or communities is to satisfy their needs for identity. Firms might exploit this societal tendency to gain a competitive advantage. Using the strategic approach adopted by Kiehl’s, a U.S. cosmetic producer and retailer, as a source of inspiration and illustration, this paper develops a novel theoretical framework to investigate how firms interact with communities to access privileged customers’ information, from which they can build a product differentiation advantage. We argue that by adhering and supporting a well-defined set of values, Kiehl’s both achieves community membership and strengthens the sense of identity that its target communities provide to their members. These investments prompt reciprocal community member behaviors, which the company channels into its customer knowledge development process. Finally, this article describes how firm–community interactions can protect the differentiation advantage by turning products into symbols of the communities to which its customers belong.

Suggested Citation

  • Martínez Ros, Ester & Lado Couste, Nora Rita & Martos Partal, Mª de las Mercedes, 2010. "Trends in packaging claims for new products : impacts on firm value," INDEM - Working Paper Business Economic Series id-10-02, Instituto para el Desarrollo Empresarial (INDEM).
  • Handle: RePEc:cte:idrepe:id-10-02
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    References listed on IDEAS

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    1. Maidique, Modesto A. & Zirger, Billie Jo, 1985. "The new product learning cycle," Research Policy, Elsevier, vol. 14(6), pages 299-313, December.
    2. Friestad, Marian & Wright, Peter, 1994. " The Persuasion Knowledge Model: How People Cope with Persuasion Attempts," Journal of Consumer Research, Oxford University Press, vol. 21(1), pages 1-31, June.
    3. Klaus Grunert & Liisa Lähteenmäki & Yasemin Boztug & Emilia Martinsdóttir & Øydis Ueland & Annika Åström & Piritta Lampila, 2009. "Perception of Health Claims Among Nordic Consumers," Journal of Consumer Policy, Springer, vol. 32(3), pages 269-287, September.
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