Different rebranding barriers in emerging countries and developed countries
The amount of businesses worldwide that are branching out to foreign markets to capture a greater market share has never been greater. In that process, rebranding is a crucial asset for a company’s expansion. This is shown by Manoella Antonieta Ramos da Silva, PhD student at Halmstad University, in her research. At the same time, there are different barriers in developed and emerging countries that must be overcome by businesses that aim to expand to other nations.
There are several advantages for companies to move across national borders, for instance the chance to increase competitiveness, expand brand portfolio, and achieve rapid growth. Multinational enterprises tend to go through acquisitions of existing, well-known, and proven brands to, for instance, minimize high costs and risks of product development. However, to succeed as a global brand, enterprises must figure out how consumers in various environments consume.
Manoella Antonieta Ramos da Silva is a PhD student in Innovation Sciences with a focus on business economics at Halmstad University. In her licentiate thesis that will be presented, she has explored rebranding, that is, how companies that want to expand to the international market need to change their corporate image for it to work on a new market.
More than cultural barriers
“In this globalized world, understanding context and culture is becoming increasingly important. Businesses need to consistently identify and differentiate its products or services across cultural, linguistic, and geographic markets. To brand internationally, a firm needs to acclimate – not only by the brand name – but also its visual identity, packaging design and marketing methods according to the national contexts. It is very complex”, says Manoella Antonieta Ramos da Silva.
Manoella Antonieta da Silva has above all explored business-to-business multinational enterprises in the life science industry. International growth through international acquisitions, she explains, is a common practice in the sector:
“The life science industry experiences institutional differences between different national markets. I have explored how the rebranding process is implemented in the life science industry and what challenges the businesses face”.
Deeper dive into the life science indusry
As Manoella Antonieta Ramos da Silva defends her licentiate thesis in October 2022, she will be halfway through her Doctoral education in Innovation Sciences. The next step in her journey to a PhD degree lies within the setting of the research project Legitimation of newness and its impact on EU agenda for change, LNETN. The LNETN project addresses the need for understanding and interpreting complex phenomena within social sciences and economics, in ways which will transform effective decision making and policy implementation of legitimation of newness and innovation and contribute to economic development.
“My focus will be on examining how institutional contexts and policies shape and are shaped by the emergence, legitimation, and internationalization processes of life science industries. This includes for instance international product launch, scaling up marketing and sales, expensive and difficult clinical trials, regulatory demands, gaining access to hospitals and doctors, and financing the complete research and development process”, concludes Manoella Antonieta Ramos da Silva.
Emerging countries versus developed countries
In her licentiate thesis, Manoella Antonieta Ramos da Silva presents a framework that demonstrates how businesses in emerging countries face more external challenges compared to businesses in developed countries. While emerging economies – such as Brazil, Colombia, and Mexico – mainly struggle with institutional constraints during the rebranding process, developed economies – such as Sweden, Germany, and the United States – contend with internal communications barriers.
“Emerging countries battle, for instance, delays in the event of legal name change in acquisitions due to the complex system of the life science industry. This can decelerate the rebranding process, and as a result, confuse customers as well as employees during the brand adaption period”, explains Manoella Antonieta Ramos da Silva.
On March 13, 2017, an international academic agreement for double degrees in the third level of education was agreed upon by Regional University of Blumenau – FURB, Brazil, and Halmstad University, Sweden. The agreement aims to strengthen the ties between Brazil and Sweden through academic research in the field of Innovation Sciences and whose results contribute to the development of both countries in areas such as Health Innovation, Industrial Management, and International Marketing. Through this collaboration, students have the opportunity to complete part of their doctoral studies at the partner university under the guidance of supervisors from both universities.
In developed economies, on the other hand, employee loyalty to the existing brand is a prominent barrier to the rebranding process. This loyalty plausibly stems from the employees’ emotional ties to the old brand, which makes it hard to convince them that the new brand signals the same standard or value. Manoella Antonieta Ramos da Silva endorses however that firms can increase acceptance during the rebranding process and make the implementation easier by considering the national context of the subsidiary:
“Rebranding is a complex process that must be tailored to each situation”.
Text: Katarina Tran
Top illustration: iStock
Photo: Katarina Tran
About the thesis
Title: International Branding and Brand Integration in Cross-Border Acquisitions
Presentation: October 12 at 10.00, in S1080 at Halmstad University
Supervisor: Professor Svante Andersson, Halmstad University and Senior Lecturer Ulf Aagerup
Opponent: Professor Mikael Hilmersson, Gothenburg University
Examiner: Professor Thomas Magnusson, Halmstad University