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Journal of the Academy of Marketing Science

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01.07.2013 | Original Empirical Research

Corporate brand name changes and business restructuring: is the relationship complementary or substitutive?

verfasst von: Kartik Kalaignanam, S. Cem Bahadir

Erschienen in: Journal of the Academy of Marketing Science | Ausgabe 4/2013

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Abstract

Corporate brands are strategic assets for organizations, but it is difficult to understand the value added by corporate brand name changes because they often occur simultaneously with business restructuring initiatives. The authors test a framework that delineates the informational relationship between corporate name changes and business restructuring initiatives. The hypothesis is tested on a sample of jointly announced corporate name changes and business restructuring initiatives. The results show that jointly announced corporate name changes and business restructuring are significantly more informative than the sum of their individual effects. The results further suggest that the information complementarity arises because corporate brand name changes resolve uncertainty and help in coordinating business restructuring initiatives. The results do not support the view that corporate brand name changes are cosmetic and/or primarily signals for business restructuring. The study offers a promising research foundation for understanding the value of marketing actions announced jointly with other corporate events.

Vorheriger Artikel Managerial decision making in customer management: adaptive, fast and frugal?

Nächster Artikel An introspective examination of single-unit versus multi-unit franchisees

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We use the terms “corporate brand name changes” and “corporate name changes” interchangeably in the paper.

We thank an anonymous reviewer for this suggestion.

We thank an anonymous reviewer for bringing this issue to our attention.

We do not include minor brand and/or product line changes that do not influence the resource allocation significantly in the firm.

Markides (1992) examined stock market reactions to 45 business restructuring announcements for a 9 year period between 1980 and 1988.

Details on the comparisons of the different samples are available from the authors.

We thank an anonymous reviewer for this insight.

We thank an anonymous reviewer for this suggestion.

Past performance has a positive effect on name change choice and negative effect on business restructuring choice. This is because higher past performance might release slack resources necessary to implement corporate name changes whereas lower past performance might serve as the motivation for firms to restructure and improve its future financial prospects.

We thank an anonymous reviewer for this suggestion.

We thank an anonymous reviewer for bringing this to our attention.

We would like to emphasize that not all the changes in the brand portfolio of a firm qualify as a business restructuring move according to our definition. For example, the deletion of a small brand that does not have significant revenue composition implication is not included in our sample. Therefore, we acknowledge that such changes would not necessitate a corporate name change. We thank one of the reviewers for pointing out this caveat.

We thank an anonymous reviewer for this suggestion.

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Titel: Corporate brand name changes and business restructuring: is the relationship complementary or substitutive?
verfasst von: Kartik Kalaignanam
S. Cem Bahadir
Publikationsdatum: 01.07.2013
Verlag: Springer US
Erschienen in: Journal of the Academy of Marketing Science / Ausgabe 4/2013
Print ISSN: 0092-0703
Elektronische ISSN: 1552-7824
DOI: https://doi.org/10.1007/s11747-012-0321-6

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