Consumer-based Brand Alliance Evaluation Research

Today the enterprises are facing three key issues: the complex and ever-changing consumer market, the increasingly fierce market competition and energy and environmental problems which bring the enterprises unprecedented challenges. In the complex and volatile environment, in order to meet the increasingly discerning consumers, the pressure of competition and mergers and acquisitions and the supervision of public opinion, brand alliance has been an effective competitive strategy to create interest and reduce risk which is one of the most important strategy choices for business investment decision-making. Brand alliance is defined "two or more brands are combined with tangible or intangible property". It aims to take full advantage of strength of several cooperation brands and raise consumer evaluation of products or services. As the possibility of failure for developing new brands continue to rise, brand alliance has become a popular marketing phenomena, and even the major business operation model. Nevertheless, the brand alliance still is a relatively new marketing strategy which is posited in the initial stage of the development and facing many basic issues in academic and management. However, with the brand management research has been revitalized, brand alliance has become a hot issue of brand research areas in recent years.The thesis first introduces the background of the study and brand alliance research, and then analyzes the connotation, characteristics and Classification of brand alliance, also the factors which influence the evaluation of brand alliance. Then, on the basic of the factors and the existing evaluation model the thesis proposes a more comprehensive concept model framework of brand alliance evaluation and an empirical analysis tests the effects between variables. Based on this study, the thesis attempts to enter into a dynamic study. It applies the NK model of complex system analysis into brand alliance strategy and observes whether brand alliance strategy is effective in the long term. Finally, the conclusions, theoretical and practical significance, and further research directions are given.The researchers are less than consistent with the definition of the brand alliance. There are also a variety of terms which describe brand cooperation. Brand alliance is essentially a cooperative marketing activity which involes not only physical resources but also intangible resourses. Their duration is different too. Different form strategy alliance brand alliance is an agreement of cooperation. Generally there will be at least one well-known brand to participate in it. The participants must have a similar customer base. The brand alliance has to create value for customers. The effects which the brand alliance imposes on the participating brands are different. The intent to classify brand alliance activities of most researchers is in need of research goals or to get a better unstanding of characteristics of brand alliances. The thesis identifies several classification models. Signal theory is most used for analyzing brand alliance phenomenon, as well as association network theory, situation theory, information integration theory and so on. The factors which influence the evaluation of brand alliance and appear in the literature include prior brand attitude, fitness and familiarity.In the concept model framework, we believe that familiarity and well-known are different concepts. We also add several new variables - vulnerability, customer perceived interest and extension fitness and analyze the direct effect to brand alliance and the interaction between each other. The brand cooperation between communication service providers and cell phone manufactures is chosen in study design. We construct three experiment scenes. The first scene describes a joint promotion where mobile communication service providers assist mobile phone brand in product sale. The second scene describes cooperation for developing new products. The mobile communication service provider makes hope to develop mobile phone with an existing brand manufacture. The third scene is familiar with the second scene, but the cooperation brand is fixed communication service provider and a mobile phone manufacture. In the third scene the complementarities and extension fitness is lower than in the second scene.The result show that well-known and familiarity are different. The well-known brand has a significant effect to evaluation of brand alliance and participants under any condition. However, when the fitness between participants is high, brand familiarity will only influence its own post evaluation but not the partner. On the other hand, in a scene of conjoint promotion, brand familiarity does not influence brand alliance evaluation significantly. But in a scene of product development, brand familiarity influence the evaluation of brand alliance significantly. In addition, when the fitness between participants is low, brand familiarity influences the evaluation of not only brand alliance but also participants. The results suggest that well-known is a variable that influences the evaluation of brand alliance and participants under any condition, but familiarity has different effect to brand alliance and participants under different scenes. When the fitness between participants is high, it's difficult for familiarity to influence the evaluation of the partner. If cooperation is not so in-depth(such as joint promotions) , it's hard to influence the evaluation of brand alliance. But when the influence of other variables is low (such as fitness between participants) , the effect of familiarity become significant. Therefore, the enterprise that is making a decision of joint promotion should make every effort to find a well-known partner, but the enterprise that is making a decision of product development maybe chooses a familiarity brand and the cooperation is even more effective in a far extension.The results of the structure models show that there are strong interactions between brand vulnerability, customer perceived interest, extended product fitness and brand attitude respectively. When the interactions exist, they don't influence the evaluation of brand alliance significantly. When analyzing the direct effect to brand alliance, it seems that they don't have to be considered. Secondly, there is an interaction between product fit and customer perceived interest so that the effect product fit to the evaluation of brand alliance is less significant than brand fit. Such results suggest that when establishing brand alliance, the most important issue is attitude evaluation of participants, followed by brand fit and product fit. Managers should first consider looking for a partner with good image then brand fit and product fit between participants. Others may be secondary, at least could be covered by marketing actions in a shorter time. It's a difficult course to develop brand attitude and image for a long time.The most of research about brand alliance is comparative static which don't include the time dimension. Many researchers suggest the longitudinal study involving the time dimension is extremely important to analyze the effect of brand alliance. The thesis attempts to turn into a long-term dynamic research and demonstrate that the tireless effort of brand alliance will be effective. The sustained action of brand alliance is an effective strategy in the long run. From the view of the dynamic and long-term point, the ultimate goal of brand alliance is to improve the evaluation of participants. We apply NK model of biology created by Kauffman(1993) into the analysis of brand alliance to find whether brand alliance is an effective strategy in the long run, relative to independent development strategy. The study involves three variables - consumer "recognized heterogeneity of synergies (RHS) , the industry distinction and complexity and analyze their effect to enhance the consumer evaluation of participants. RHS is derived from fit which is the theory basis for defining evolution rules. Because "heterogeneity" of cooperation between enterprises in different industries is stronger than the identical industry, it's meaningful to test whether the former is more effective. "Complexity" origins from the NK model or further complex system theory, it's a key variable to affect system in NK model. In addition, here it also means the impact due to shock of the enterprise and brand image.The results from the NK model simulation show that the industry distinction effect of brand alliance evaluation is not significant; "Heterogeneity" of a slightly complicated brand is sufficient which can help the brand jump out of local peaks. So only if a brand image is complicated enough, the effect of brand alliance between the enterprises in different industries is not different significantly with the identical industry. When the environment is stable, the brand alliance strategy is effective regardless of simple or complex image structure. The brand with complex image structure is more willing to apply brand alliance strategy due to the more restrictions from complexity. When the brand image is redefined due to enterprise shock, we should make every effort to maintain but not remove a brand alliance in order to weaken the impact and quickly revive the brand market influence. If the brand is facing a market with dramatic changes, the complex brand image can enhance the brand ability to deal with these changes, extend the life cycle of the brand and accumulate brand equity. At the same time, in a rapidly changing market, it is not necessary for the brand with the simple image structure to develop a brand alliance. But it's an effective strategy for the brand with the complex image structure.Currently, the research of brand alliance still has to address some basic academic and management issues. Further research should be concerned about the two directions. The first is the moderator and condition variables that influence the evaluation of brand alliance and the second, is applied psychological model and process by consumers when they are evaluating the brand alliance and participants. As far as theory study, more attention should be given symbolic brand alliance, continue to explore the dimensions of fit and get more in-depth understanding of brand alliance from information economics. We need more empirical research about longitudinal comparative case studies, the unique problems for evaluating brand alliance and the interaction between the brand alliance and participants. Practically, when an enterprise makes a decision of brand alliance, managers will find they are facing many new brand management issues.