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ORIENT ACADEMIC FORUM The Small and Medium-sized Enterprise Brand Communication Based on the Influenza Virus Propagation Model HAO Pengfei, LIU Donglei School of Business, Agricultural University of Hebei, Baoding, China, 071001 Abstract: China's large enterprises has been realized the brand value. But some of China's SMEs do not realize it is important. Although some realize the important that building the brand, lack of funds and talents, which hinder its brand communication and promotion. Therefore, brand communications for small and medium enterprises should explore an effective low-cost way. The paper compared brand communications for SMEs and spread of pandemic virus. Based on the spread of pandemic virus model, it propose that the small and medium enterprises can make use of popular mode for the brand communication. Keywords: small and medium enterprises, Brand, pandemic virus 1 Introduction Brand has become the most important vocabulary in the terms of economic management. Sometimes the brand value surpasses itself for the enterprise or the country. June 28, 2010 in Beijing, the World Brand Lab (World Brand Lab) issued by China's Top 500 Brands in 2010 data, China Mobile (129.071 billion yuan), National Grid (126.328 billion yuan), Industrial and Commercial Bank of China (126.019 billion yuan), CCTV (1135.83 billion), China Life Insurance (85.368 billion yuan), etc. have become the world-class brands. Scholars at home and abroad have done extensive research. One of the research field is the concept of brand communication, it has undergone five major changes, USP stage, stage of brand image, brand personality stage, stage of brand positioning, brand recognition stage. In the 90's "brand equity" concept put forward, and with the development, the researchers focused on the brand of the "brand assets" value-added. And the last few years the concept of strategic management of the brand came into being. However, China's SMEs to brand awareness have fall behind. Brand Management Consulting Co., Ltd. on Maidi ShangHai latest survey shows that SMEs in brand management is not optimistic. Only 44.4% of the SMEs realize that the brand is very important. Second, most SMEs do not set up special departments for brand management, only 40.7% of SMEs have a special department for brand management. Only 37% of the SMEs have developed a brand strategy, 10% of SMEs to set up a dedicated brand manager positions. And only 16% of the SMEs are doing brand tracking. Therefore, SMEs have to face the problem how to doing brand communications. 2 Brand Communication Mode for the SMEs of China It has a sophisticated means and methods for the brand communication at the current. Early American scholars Lasswell gave the 5w mode for commnication. He believes that any such communication process can be broken down into five parts, namely: (1) ‘who’ (who) - the main transmission, (2) ‘say’(says What) - dissemination of content, (3) ‘by What channel ’(in Which Channel) – Media, (4) ‘to whom’ (toWhom) - Communication object, (5) ‘what kind of effect’ (with What effect) dissemination of results. According to the theory, as a branch of communication ‘brand communication’, in fact, the propagation process of concrete, the propagation process can be summarized as: ‘brand owner’ through ‘the media’ to its ‘target audience’ (consumers) pass ‘brand message’ (communication content), "brand owners" of course, spread the brand message should be concerned about whether the purpose is expected to achieve after the (communication effects). Enterprises should demonstrate the 210 ORIENT ACADEMIC FORUM inherent quality products to consumers. But the products can not speak, it is necessary to enhance communication with consumers, which advertising is the most effective way. The world's leading advertising expert Rosser Reeves (1961), published <The Reality of Advertising>, it raised in the unique selling proposition (USP-Unique Selling Proposition) theory. David Ogilvy, according to their advertising and brand building , put forward the image theory. Brand building must first decide what kind of image of the brand, image is the personality. In 1972, AlRies & Jack.Trout in the <Psychological ad strategy - brand positioning>, proposed a new theory - positioning theory. Positioning theory is mean that the brand is established a favorable association in the minds of consumers. In an other word, the consumers remember the brand and like it. At present, some scholars propose an integrated marketing communication model, relying on advertising, sales promotion, public relations, personal selling and direct marketing. However, all the ways like advertising, positioning, integrated marketing communication is significant obstacles for small and medium enterprises. First, it lack financial support for brand communication to SMEs because of small assets and limited financing channels. Classification of SMEs in China, mainly based on the number of enterprise employees, sales, total assets and other indicators, combined with industry characteristic. Such as industry, SMEs must meet the following conditions: the number of employees is low 2,000 people and sales less 300 million Yuan, or total assets less 400 million Yuan. The special details see Table 1. , , Table 1 the small and medium-sized enterprise division standard Sales volume (ten thousand Profession Staff population (human) Yuan) Total assets (ten thousand Yuan) Being lower than 4000 Being lower than 4000 Industry Being lower than 2000 Being lower than 30000 Architecture industry Being lower than 3000 Being lower than 30000 Wholesale and retail sales Being lower than 500 Being lower than 15000 - Being lower than 3000 Being lower than 30000 - Being lower than 800 Being lower than 15000 - Transportation and postal service industry Lodging and food and beverage industry It can be seen that the overall size of SMEs is small, and does not have ability to competition with large enterprise. For example, all the top 500 Chinese private enterprises’ profits less than the sum of two central enterprises such as China Mobile and PetroChina Company Limited. It shows that the size and competitiveness of SMEs is weak. At the same time, financing ability is limited at present. All the SMEs financing channels is limited to government support, bank loans, public finance, venture capital, property rights trading market, a collection of bonds, small loan companies, rural banks and rural finance small and medium sized financial institutions, credit union, etc. But all the financing organizations require some mortgage. What the SMEs developed projects or products is prospects, but the lack of collateral assets. And the traditional industry business, it is difficult to obtain government support. Second, SMEs lack the professionals of brand management and communication. Due to historical conditions, the start is late for China's SMEs. And the professional management staff have not received systematic education, lack of skills of management. In management, it lack of the institutionalization, standardization and procedures. And the reward and punishment system is opaque. So it is difficult to arouse staff’s enthusiasm and creativity. And it is difficult to attract talent to joins the organization. Some SMEs are Family firm, in management they trust their relatives. And they chooses the talented person only by the standards of honest and faithful, do not focus on ability. So the staff is difficult to development and being promoted. At the same time the pay and benefits, compared with large 211 ORIENT ACADEMIC FORUM enterprises, is a certain gap. So the brain drain phenomenon is obvious. Therefore, to small and medium enterprises in the current, capital and talent become the bottleneck for brand communications. It is necessary to choose, low-cost and meet the current needs of brand development, ways and modes. The epidemic spread of the virus quickly, and mutual communication is simple, small and medium enterprises can make use of popular mode of transmission of the virus for the brand communication. 3 Pandemic Virus Propagation Model Virus is a kind of non-cell morphology between forms of life and non-life material. Individual is small, and most of them can be seen by the electron microscope. They only have one type of nucleic acid, or DNA or RNA. Scientists have long believed that the epidemic could eventually form a particular transmission. In some incubation period is very short, highly infectious cases, the number of infections is usually a small number of popular early, and reached a peak point after point in the index rate of disease would disappear. By the infectious disease's statistical data carries on processing and the analysis, it found that , in general, every time the number of people involved the infectious disease is a constant in a given region or nation. How to explain this phenomenon? After a long research, scientists given viral infection model. Assumptions: (1) Each patient in unit of time infects the population is a constant K0. (2) Recording i (t ) expresses the “t” time patient number, without regard to patient recovery situation, and assuming that the patient does not die during infection. In the initial moment, the number of patients i (0) = 0 Model: Consider initially patients is 0 , increase in ∆t time number of patients i (t + ∆ t ) − i(t ) = k 0 i (t ) ∆ t On both ends of the divided type ∆t, and that ∆t → 0, obtain the following model, i i i (t + ∆ t ) − i(t ) = k 0 i (t ) ∆ t (1) i (0) = i0 Solution: (1) the formula separation variable, the integral and leads the starting value, obtains the solution is i(t ) = i0 e k 0t (2) Analysis: Infectious disease's dissemination is increases according to the exponential function, this results explained infectious disease's spreading process and infectious disease's proliferation rule. Number of infected persons Diffusion time Figure 1 the spread of the pandemic virus T1-T2 The healthy persons and the infected person contact few, Viral quantity is very small, Total infected person quantity are few T2-T3 The healthy persons and the infected person contact increase, The viral quantity increases, The infected person to increase greatly 212 ORIENT ACADEMIC FORUM T3 The virus propagation rate reaches the maximum value T3-T4 The healthy individual reduces gradually, the virus propagation rate reduces gradually, terminates until this diffusion process 4 SME Brand Communications and the Spread of Epidemic Transmission of the Virus Analogy SME brand communications process and the spread of pandemic virus spread process is very fitting. Such as: early in the SME, brand awareness is very low, the amount of information is very small. And few people know about the brand. With the development of enterprises, some of the consumer use their products or experience the services. When the consumers know its brand personality and features, they will deliver information to more people. So the brand awareness further enhance in consumer. Brand impact and visibility gradually stabilized, it reached the maximum. Then gradually reduce the potential use of brand, communication diffusion rate decreases until the diffusion process to terminate. Brand communications process, which depend the core consumer who like the brand's personality, gradually spread out. More and more consumer know the brand, and more people are affected. This process is similar to the spread of infectious diseases. Experiences as consumers are as those infected persons, healthy individuals as potential customers. Infected persons contacts with the health, the health are infected. The more infected persons, the more virus are increasing. The disease has accelerated the spread of infection. Until the health of individuals depleted, the diffusion rate will be moderated. It summarizes the SME brand communications and the spread of epidemic transmission as table 2. Table 2 SME brand communications analog transmission of the virus spread Premise: When the pandemic virus long cure cycle or propagation rapidly SMEs in the early brand communications Pandemic virus infection Consumers or who experience Potential users Potential users to communicate with those who experience Increasing numbers of brand awareness Accelerating pace of brand communications Diffusion rate down to a certain point, then the exponential rate of decrease Infected person the health of individuals Healthy individuals constant contact with infected persons More and more infected Accelerating rate of epidemic spread of the virus Diffusion rate down to a certain point, then the exponential rate of decrease 5 Brand Communications for SMEs Based on Pandemic Virus Propagation Model Based on the small and medium-sized enterprise brand dissemination and the popular viral dissemination model's analogy, it may reduce the brand dissemination cost and overcome the weakness of talented person deficient. If the small and medium-sized enterprise can use pandemic virus dissemination pattern, which can help the SMEs overcome the obstacles of brand communication. It need pay attention to several aspects of brand communication when use popular virus dissemination model. 5.1 SMEs how to choose the consumer in initial brand communication View from the pandemic virus propagation model, the first prerequisite for pandemic virus is a virus infection. Brand communications for small and medium enterprises, it needs to have the initial period brand experience, moreover these experience have infect other people's ability. And the SMEs can depend some of the certain events or certain situation on effect consumer brand awareness and 213 ORIENT ACADEMIC FORUM experience. Generally the small and medium-sized enterprise management's scope is this locality or the region market, the product or the service has certain unique selling point, therefore needs affect this locality or the region public figure starts to carry on the brand communication. Next, carries on the brand experience with the aid of this locality and the region market's individual event. For example, Jinjiang Hotel of Baoding city, with the opportunity of building the China Power Valley of Baoding city, are building an environment friendly and low carbon hotel. At the hotel exterior, it established solar electrical energy generation equipment, which can sets up unique brand. 5.2 Choose the low cost channel for brand communication Epidemic virus infection on the number of susceptible people is the key factor in the spread of pandemic virus. The consumers which effect the potential people is the key of brand communication. But Internet's popularization and the technical progress, might let the consumer use the electronic media to carry on the wide-ranging exchange and the communication. Network provide free exchange of space to consumers better than a reality. SMEs should make full use of chat rooms, instant messaging, blog, product review sites and virtual communities to spread the brand. For example a caltech student established website Buddyzoo.com, this website application society network analysis method supply the following information: who have the same interest with you, consults own good friend, the estimate with other people's between distance, and so on. The website user may also see their prestige rank. The small and medium-sized enterprise may draw support from such platform carry on the brand communication. 5.3 Grasp the core value, and constantly adjust the brand extension Epidemic spread of the virus to a certain extent, it will reduce its infectivity, and then gradually disappear. It is well known, the influenza virus has been at the active condition, threatens the human health, its basic reason is adjusts the immune body through the unceasing variation, but it affects to the humanity the core gene actually does not have the change. Small and medium-sized enterprise, which doing brand communication, should grasp own brand’s core value. Regardless of product outward appearance, product type substandard in form. But the internal idea, the internal brand's connotation should continue. For example, the brand, BMW, Mercedes, Volvo, never change the core value although the products changed many times. Therefore only the core value is invariable, can have the long-term inheritance brand, and have the extension brand charm. But the brand extension must change, it can be popular. Otherwise the brand influence would weak gradually. Perspective from the virus host, it should give the virus opportunity to duplication. And perspective to brand, it is necessary to add the features of products or services , or rise the technology level. That can cause the consumer to find the new point, then expand the scope of brand communications. 6 Conclusion China's SMEs lack of emphasis on brand communication. There are two reasons, on the one hand, it is the ideas. On the other hand, it is the important reason of the lack of funds and talents. Those reasons prevent the spread of its brand. According to popular features of the virus spread, it may discover that the virus's propagation mode can be used as a reference for SMEs brand communication. Therefore, so long as the small and medium-sized enterprise can find own brand the unique characteristic, it can seize the target customer. At the same time to seize the key figures and important events, you can quickly increase brand awareness. At the same time, in order to attraction customer for the long-term, the small and medium-sized enterprise must inherit the brand the core value. It can change and adjust the brand extension through constant technical innovation, product innovation. So the China's SMEs can continue to create popular, create a strong brand. 214 ORIENT ACADEMIC FORUM References [1]. Bristor,Julia M.Enhanced explanations of word of mouth communications: The power of relationships[J].Research in consumer behavior,1990,(4):51-83. [2]. Li Wei. On Mathematical Model of the Spread of SARS Virus. Journal of Bijie Teachers College, 2004,22(2): 46 52(in Chinese) [3]. YANG Xue, Qian Ming Hui. The Influence of Online Reputation on Consumer’s Decision, Contemporary Economy & Management, 2006,28(3):27~31(in Chinese) [4]. Xu Yanmei, Li Fei, Hao Pengfei Pandemic virus transmission model and the diffusion of technological innovation, China High Technology Enterprises, 2008,2:65~67(in Chinese) ~ 215