Employer branding and its influence on managers

European Journal of Marketing Employer branding and its influence on managers Gary Davies

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Employer branding and its influence on managers

Employer branding and its influence

Gary Davies Manchester Business School, Manchester, UK


Abstract Purpose – The paper seeks to explore the role of the employer brand in influencing employees’ perceived differentiation, affinity, satisfaction and loyalty – four outcomes chosen as relevant to the employer brand. Design/methodology/approach – A multidimensional measure of corporate brand personality is used to measure employer brand associations in a survey of 854 commercial managers working in 17 organisations. Structural equation modelling is used to identify which dimensions influence the four outcomes. Models are built and tested using a calibration sample and tested on two validation samples, one equivalent to the calibration sample and another drawn from a single company. Findings – Satisfaction was predicted by agreeableness (supportive, trustworthy); affinity by a combination of agreeableness and (surprisingly) ruthlessness (aggressive, controlling); and perceived differentiation and loyalty by a combination of both enterprise (exciting, daring) and chic (stylish, prestigious). Competence (reliable, leading) was not retained in any model. Research limitations/implications – Further work is required to identify how appropriate improvements in employee associations can be managed. Practical implications – The findings emphasise the importance of an employer brand but the results also highlight the complexity in its management, as no one aspect has a dominant influence on outcomes relevant to the employer. At issue is which function within an organisation should be tasked with managing the employer brand. Originality/value – Employer branding is relatively new as a topic but is attracting the attention of both marketing and HR academics and practitioners. Prior work is predominantly conceptual and this paper is novel in demonstrating empirically its role in promoting satisfaction, affinity, differentiation and loyalty.

667 Received October 2006 Revised January 2007; April 2007 Accepted May 2007

Keywords Brands, Product differentiation, Customer satisfaction, Customer loyalty Paper type Research paper

Increasingly companies are allocating funds to what has been termed the employee or employer brand, i.e. the set of distinctive associations made by employees (actual or potential) with the corporate name. A strong employer brand attracts better applicants (Collins and Stevens, 2002; Slaughter et al., 2004) and shapes their expectations about their employment (Lievens and Highhouse, 2003). What is less clear is the role of branding with existing employees, the focus for this paper. A brand is a symbol that encapsulates the many associations that are made with a name (Gardner and Levy, 1955) and many things can be branded (Levitt, 1980), including the company itself, but is the role and effect of the employer brand similar to that of the brand in its usual context, that of influencing customers? This paper identifies the roles that the employer brand might be expected to play, the roles that are relevant to a corporate brand and to employees: creating (employee) satisfaction, affinity and loyalty and perceived differentiation. The main contribution of the

European Journal of Marketing Vol. 42 No. 5/6, 2008 pp. 667-681 q Emerald Group Publishing Limited 0309-0566 DOI 10.1108/03090560810862570

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paper is to provide empirical evidence of the influence of employer branding. The context is that of one important and potentially mobile employee group, i.e. commercial managers. Branding and the employer brand When considering customers, a brand provides its owner with two benefits: differentiation, so that the customer is less able to decide on price alone and a franchise (Davies, 1992), the latter stemming from customer satisfaction with the brand and loyalty to it. Customers choose to purchase for rational reasons but their emotional attachment is also important. These four attributes of a brand – the ability to differentiate, to create loyalty, to satisfy and to develop an emotional attachment – are, it is argued, also relevant to the employer brand. The effects of a brand are often referred to as its “equity”, rooted in the customer’s knowledge about the brand. Two factors contribute to brand knowledge: (1) awareness; and (2) image (Keller, 1993). Awareness is not at issue for existing employees and so the focus in this paper is therefore on image. Brand image concerns the associations held of a brand in memory; and brand personality, the projective technique used here, is one measure of these (Keller, 1998). Brand personality, the human associations we make with a brand, is a way of obtaining a holistic view of a brand’s associations by using the metaphor of brand as person and applying the equivalent of a personality test to the brand. Two such measures have been developed to measure employee views (Davies et al., 2002, 2004; Slaughter et al., 2004) using human personality traits, similar to those used in assessing the personality of an individual. For example one corporate brand may be described as being more “honest” or more “daring” than another. The approach forms part of the psycholexical tradition, that languages develop groups of adjectives to describe the most important differences between significant objects. We personify brands, and a similar but not identical list of adjectives that we use to describe people exists for brand personality (Caprara et al., 2001). The Corporate Character Scale (Davies et al., 2004) that was adopted here has five main and orthogonal dimensions: (1) agreeableness; (2) enterprise; (3) chic; (4) competence; and (5) ruthlessness (Table I). Agreeableness has three facets, each with a number of measurement items: (1) warmth (e.g. friendly, pleasant); (2) empathy (concerned, supportive); and (3) integrity (honest, trustworthy).


Agreeableness

Enterprise

Competence

Chic

Ruthlessness

Cheerful Pleasant Open Straightforward Concerned Reassuring Supportive Agreeable Honest Sincere Trustworthy Socially responsible

Cool Trendy Young Imaginative Up to date Exciting Innovative Extravert Daring

Reliable Secure Hardworking Ambitious Achievement-oriented Leading Technical Corporate

Charming Stylish Elegant Prestigious Exclusive Refined Snobby Elitist

Arrogant Aggressive Selfish Inward-looking Authoritarian Controlling

Source: Davies et al. (2004)

Enterprise includes: . modernity (cool, trendy); . adventure (imaginative, innovative); and . boldness (extravert, daring). Competence includes: . conscientiousness (reliable, hardworking); . drive (ambitious, leading); and . technocracy (technical, corporate). This dimension represents the more tangible aspects of a corporate brand, those associated with quality. The chic dimension includes: . elegance (charming, stylish); . prestige (prestigious, exclusive); and . snobbery (snobby, elitist). This dimension represents an aspect of branding that is well developed by luxury brands. Ruthless has two facets – egotism (arrogant, aggressive) and dominance (authoritarian, controlling) – and is the one negatively valenced dimension. There is limited literature to guide expectations on what aspects of brand personality might be most influential with employees and, in the absence of any clear direction, a more exploratory approach was adopted in the following empirical study. No initial assumptions were therefore made about which dimensions of brand personality would be salient for each outcome. Brand and differentiation The original objective for branding (a burn on cattle or a mark on bricks) was to distinguish the ownership or origin of one item from other similar items; hence the traditional association of branding with differentiation. A brand name is more than

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Table I. The five main dimensions of corporate personality

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just a label to differentiate (Gardner and Levy, 1955), but differentiation is still the essence of branding (Aaker, 2003). Marketing campaigns seek to differentiate the brand by positioning it as superior on one or more attributes relevant to the customer (Pechmann and Ratneshwar, 1991). Differentiation reduces price competition and is consequently seen as a source of competitive advantage at the corporate level, where it is one of three generic strategies (Porter, 1980). Employees as well as customers like to be associated with distinctive organisations (Dutton et al., 1994). One role of the employer brand should be then to distinguish the employer in the minds of employees. Hence the first hypothesis:


H1. The stronger one or more aspects of the employer brand’s personality, the greater will be the perceived differentiation of the employer. Brand and loyalty Brand loyalty refers to a customer’s propensity to purchase the same product over time (Jacoby and Chestnut, 1978) and differs somewhat from employer brand loyalty. While there are examples in business-to-business markets of long-standing relationships and examples in employment of short term contracts, switching brands in a consumer market can be done relatively frequently and at little cost to the individual. Switching employers involves far higher costs and is done only every few years (respondents to the study reported here had spent an average of 12.9 years with their employer). Various factors can influence the employee to leave an organisation, or to remain despite being dissatisfied. Employees who have greater opportunity to voice dissatisfaction are less likely to quit (Spencer, 1986). An intention to quit is related to job stress, lack of commitment to the employer, and job dissatisfaction (Mellor et al., 2004). Most labour turnover models include a significant impact of affective factors, including organisation commitment, well-being and job satisfaction (Steel et al., 2002; Steel, 2002). Job satisfaction and organisational commitment are frequently assumed to influence the decision to leave (Winterton, 2004) but the influence of the corporate brand on this process, probably the most significant affective factor in an organisation, is never considered. To assess the potential relevance of its role in creating loyalty, a second hypothesis is proposed: H2. The stronger one or more aspects of the employer brand’s personality, the greater will be employee loyalty. Brand and satisfaction One role of a brand is to create and enhance satisfaction. Satisfaction predicts future behaviour towards the brand (Mittal and Kamakura, 2001) and, as explained above, satisfaction with the job and with the employer are useful predictors of an intention to leave an organisation. Employees who are more satisfied also create better relationships with customers (Heskett et al., 1997). Customer satisfaction is often measured in commercial surveys by using multi-attribute scales, each attribute representing one aspect of the desired product or service (Wirtz, 2003). Work on employment issues tends to focus on job satisfaction and on its links to employee behaviour, rather than on satisfaction with the employer, but job satisfaction is less likely to be influenced by the employer brand than will be overall satisfaction with the

company. One important role of the employer brand should then be to promote employee satisfaction, hence:


H3. The stronger one or more aspects of the employer brand’s personality, the greater will be employee satisfaction. Branding and affinity A strong brand elicits an emotional response from a consumer (Yeung and Wyer, 2004). The level of arousal, the quality of consumption experience and the emotional attachment to a brand all influence the consumer’s affective evaluation (Tsai, 2005). The emotional attachment of the employee to their employer is normally assessed by measuring commitment (Steel, 2002), the desire to maintain one’s membership of an organisation (Meyer and Allen, 1991), or the allied construct of identification (Riketta, 2005), the linking of the organisational member to his/her self-concept by feeling a part of the organisation and having pride in membership. Recognising the importance of commitment and identification goes some way to recognising that an organisation can be viewed usefully through an emotional lens and not just through the lens of rationality (see, for example, Fineman, 1993). As the success of branding is concerned with promoting an emotional response from the target, the employer brand should promote an affective response from the employee. Hence: H4. The stronger one or more aspects of the employer brand’s personality, the greater will be the employee’s affinity to the brand. Methods Sample The market for employees is heterogeneous but one relatively coherent and important sector is “commercial managers”, defined here as those with managerial responsibility, working in a business context but not working in a technical role, such as research and development. In total, 854 commercial managers working for 17 organisations were surveyed. A main database of 527 responses from managers in 16 organisations (Table II) was randomly divided into two, a calibration sample of 269 and a validation sample of 258. A second validation sample of 327 managers from one company, a food retailer, was used to test whether any findings were relevant at the level of a single organisation. Response rates to the questionnaire varied but were always higher than 80 per cent of those approached. The managers were surveyed while attending management development courses at a business school. Measures The Corporate Character Scale (Table I), was used to measure the managers’ brand associations. Respondents were asked to imagine that their organisation had “come to life” as a human being and to rate its personality on a five-point Likert-type scale anchored by 1 ¼ strongly disagree and 5 ¼ strongly agree that the item described the organisation perfectly. Perceived differentiation was measured with two items: that the firm had a “distinct identity” and a “unique personality”. Satisfaction with the organisation was measured using two items, overall satisfaction and willingness to recommend the company to others. Affinity was measured with two items: “pleased to be associated with” and “I


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Table II. Survey sample

Company Chain store retailer Ladies’ fashion store Variety store Food retailer Accountancy practice Bank Academic department Construction (A) Construction (B) Financial services retailer Systems manufacturer Advertising agency Infrastructure services Electronics manufacturer Public relations Capital goods manufacturer Media conglomerate Total

Sample

Percentage

27 29 21 68 39 30 42 71 42 15 30 26 7 33 12 9 26 527

5.12 5.50 3.98 12.90 7.40 5.69 7.97 13.47 7.97 2.85 5.69 4.93 1.33 6.26 2.28 1.71 4.93 100

feel an affinity with” the employer. All items had a five-point Likert-type scale anchored by 1 ¼ strongly disagree and 5 ¼ strongly agree. All scales proved suitably reliable (Table III). Loyalty was measured with a single item, the number of years the employee had been employed by the same company. Average scores for each variable are reported by company in Table IV. Modelling Models linking employer brand personality to outcomes were constructed and tested using structural equation modelling. Separate models were built for each target variable (satisfaction, affinity, differentiation and loyalty). The measures for the five dimensions of corporate character were aggregated at the facet level (see example in Figure 1). Each dimension was assumed to predict the target variable and allowed to co-vary with all other dimensions to eliminate any halo effect. Using the calibration

Table III. Construct to construct correlations and reliabilities

Agreeableness (1) Enterprise (2) Competence (3) Ruthless (4) Chic (5) Differentiation (6) Satisfaction (7) Affinity (8) Loyalty (9)

1

2

3

4

5

6

7

8

0.90 0.33 * 0.52 * 2 0.47 * 0.08 * 0.34 * 0.66 * 0.59 * 0.18 *

0.86 0.58 * 2 0.02 0.37 * 0.43 * 0.45 * 0.41 * 0.11 *

0.79 2 0.01 0.33 * 0.40 * 0.57 * 0.49 * 0.21 *

0.70 0.23 * 2 0.02 2 0.28 * 2 0.24 * 2 0.02

0.79 0.34 * 0.12 * 0.10 * 2 0.01

0.78 0.43 0.46 0.20

0.84 0.77 * 0.23 *

0.78 0.28 *

Notes: *Significant at p , 0:05; Cronbach’s a scores are shown on the diagonal

Chic 2.77 2.91 2.37 3.13 3.42 2.87 2.00 2.90 2.91 2.43 2.61 2.60 2.34 3.66 3.06 3.77 2.61

Company

Chain store retailer Ladies fashion store Variety store Food retailer Accountancy practice Bank Academic department Construction (A) Construction (B) Financial services retailer Systems manufacturer Advertising agency Infrastructure services Electronics manufacturer Public relations Capital goods manufacturer Media conglomerate

3.40 4.07 3.43 3.71 3.16 2.85 3.12 3.62 3.94 3.86 2.84 3.36 3.17 3.31 3.53 2.64 3.22

Agreeableness 2.20 4.17 2.26 3.57 3.75 2.67 2.38 2.98 2.87 2.32 2.51 3.40 3.48 3.49 3.18 3.69 3.63

Enterprise 3.69 4.06 3.22 4.12 4.21 3.29 3.15 3.94 3.92 3.56 3.07 3.37 4.09 3.79 3.88 3.79 3.44

Competence 3.41 2.40 2.59 2.96 3.69 3.31 3.09 2.85 2.91 2.88 3.21 2.88 3.64 2.97 3.10 4.22 3.38

Ruthlessness 3.63 4.53 3.43 4.18 3.88 3.60 3.45 4.08 4.24 4.17 2.65 3.65 4.14 3.83 3.75 3.39 4.02

Satisfaction


3.98 4.47 2.93 4.01 4.13 3.77 2.51 3.37 4.00 4.30 3.10 3.42 3.57 4.09 2.71 4.67 3.75

Differeniation

Service 12.23 6.88 13.43 10.14 6.70 10.47 7.48 8.70 14.73 17.93 8.33 5.04 4.58 13.97 2.10 8.61 7.06

Affinity 3.76 4.38 3.60 4.01 4.01 3.97 3.45 4.02 4.30 4.23 3.13 3.87 4.21 4.09 3.79 3.78 4.17


Table IV. Average scores

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Figure 1. Example of initial SEM model (shown without covariance links between corporate character dimensions)

data, models were modified by eliminating any non-significant links one at a time and then re-running the model (Jo¨reskog, 1993; Bullock et al., 1994; Long, 1983). The process continued until there were no further insignificant links and the resulting model fitted the data well. (For example, agreeableness was the only dimension to be retained in the model predicting employee satisfaction.) These models were then retested on the two validation samples and finally for the combined database. Results The results of the analyses are shown in Table V. The validation models confirmed the calibration models in each case, both for the random sample and for the sample from one company. For example, in the satisfaction calibration model, only agreeableness (friendly, supportive) was retained after removing all non-significant links in the model, showing that this dimension is best at explaining the variance in employee satisfaction. The overall fit (x 2 ½df ¼ 2 ¼ 4:46, p ¼ 0:11) is good and so the model cannot be rejected. Other fit indices are also good (CFI ¼ 0:99, GFI ¼ 0:99, Hoelter 0:01 ¼ 674 and RMSEA ¼ 0:00) indicating a well fitting model. The overall fit for the first validation

Calibration Validation 1 Validation 2 Combined Calibration Validation 1 Validation 2 Combined Calibration Validation 1 Validation 2 Combined Calibration Validation 1 Validation 2 Combined

Satisfaction

Loyalty

Differentiation

Affinity

Sample

Target Agreeableness Agreeableness Agreeableness Agreeableness Agreeableness, ruthlessness Agreeableness, ruthlessness Agreeableness, ruthlessness Agreeableness, ruthlessness Enterprise, chic Enterprise, chic Enterprise, chic Enterprise, chic Enterprise, chic Enterprise, chic Enterprise, chic Enterprise, chic

Retained dimensions 4.46 0.50 3.18 2.45 12.88 10.4 14.1 14.92 22.42 16.32 16.08 33.35 0.97 10.01 12.99 7.46

x2 2 2 2 2 7 7 7 7 7 7 7 7 3 3 3 3

df 0.11 0.78 0.2 0.29 0.075 0.167 0.049 0.037 0.002 0.022 0.024 0.000 0.81 0.18 0.005 0.059

p 0.99 1 0.99 1.0 0.99 0.99 0.99 0.98 0.98 0.99 0.98 0.98 1.0 0.98 0.96 0.99

CFI 0.99 1 0.99 1.0 0.98 0.99 0.99 0.98 0.97 0.98 0.98 0.98 1.0 0.98 0.98 0.99

GFI 674 9,654 744 1,009 385 457 690 404 221 291 375 292 2,667 240 282 671

Hoelter 0.01


0.061 0.00 0.048 0.029 0.056 0.04 0.04 0.059 0.091 0.072 0.063 0.085 0.00 0.10 0.10 0.058

RMSEA

0.32 0.51 0.50 0.51 0.38 0.40 0.39 0.38 0.32 0.37 0.16 0.32 0.06 0.09 0.03 0.07

SMC of target


Table V. Model fits and retained dimensions

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sample is even better (x 2 ½df ¼ 2 ¼ 0:50, p ¼ 0:78) and other fit indices are again good (CFI ¼ 1:0, GFI ¼ 1:0, Hoelter 0:01 ¼ 9; 654 and RMSEA ¼ 0:00). The fit for the single company sample was also good (x 2 ½df ¼ 2 ¼ 3:18, p ¼ 0:20) and again the model cannot be rejected and other fit indices are similarly sound (CFI ¼ 0:99, GFI ¼ 0:99, Hoelter 0:01 ¼ 744 and RMSEA ¼ 0:048). For the combined sample the overall fit is again good (x 2 ½df ¼ 2 ¼ 2:45, p ¼ 0:29), (CFI ¼ 1:0, GFI ¼ 1:0, Hoelter 0:01 ¼ 1,009 and RMSEA ¼ 0:029). The models also predict a high level of variance in the target variable (SMC ¼ 0:32-0:51). The implication is that commercial managers are more satisfied the higher their perception of the employer’s agreeableness. Perceived differentiation was predicted by a combination of enterprise (trendy, exciting) and chic (stylish, prestigious), but the influence of enterprise was not as strong overall as that of chic. For example, in the combined sample the standardised path coefficient for enterprise was 0.16 (CR ¼ 2:15, p ¼ 0:032) and for chic 0.44 (CR ¼ 5:59, p , 0:001). Chic’s standardised contribution to differentiation was 0.44 compared to that from enterprise at 0.16. Managers see their employer as more different/distinctive if they appear more chic and enterprising but chicness is the more important, managers apparently preferring prestige over excitement. Interestingly the same two dimensions were retained to predict loyalty, measured by length of service. However this time the influence of enterprise was negative. For example, in the combined sample analysis, enterprise has a path coefficient of 2 0.39 (CR ¼ 23:88, p , 0:001) and chic 0.40 (CR ¼ 3:91, p , 0:001). The total standardised effects of the two dimensions on loyalty are 0.40 for chic and 2 0.39 for enterprise. In other words managers stay longer with firms that they see as chic and not enterprising. The variance explained in loyalty was not high (0.07 for the combined sample model) and it would appear therefore that loyalty at least measured by the time the manager had been with the company is not heavily influenced by brand imagery. Employee affinity correlated strongly with employee satisfaction and agreeableness was important in predicting affinity. However, ruthlessness (arrogant, aggressive) was also retained and had a positive relationship with affinity. The model proved valid for all samples. The stronger path coefficient was from agreeableness to employee affinity (0.73) but the path from ruthlessness to affinity was not weak at 0.23 (CR ¼ 3:15, p ¼ 0:002) for the calibration sample, and was similar for the combined sample at 0.18 (CR ¼ 3:66, p , 0:000). The standardised effects of agreeableness and ruthlessness on affinity were 0.72 and 0.18, respectively, so while the influence of ruthlessness is small it is still important. Managers have a greater affinity to an employer whose image is arrogant, aggressive, authoritarian and controlling. For all employees the correlation between ruthlessness and satisfaction is, as one might expect, negative (Davies et al., 2002) but managers appear to be more attracted to companies with a hint of totalitarianism. Four hypotheses were used to assess the role of the employer brand and three were fully supported by the data. H1 was supported. Perceived differentiation is enhanced by a combination of enterprise (trendy, exciting, daring) and chic (stylish, prestigious, elitist). The fit indices are good for the four final models with the exception of RMSEA, which is slightly above the recommended limit of 0.08 for two of the models (Browne and Cudeck, 1993). H2 was not fully supported as one aspect of imagery had a negative influence on loyalty. The number of years a manager has been employed is apparently promoted by chic (stylish, prestigious) but reduced by enterprise (trendy, exciting). The


fit indices are good for the four models, with the exception of the two validation models where RMSEA is high. The final model fits required the dropping of one facet, boldness (extravert and daring) from enterprise, and one from chic, i.e. snobbery (snobby, elitist). H3 was supported. The fit indices are good and the level of prediction of employee satisfaction is high for all models. Employee satisfaction is promoted by an image for agreeableness (friendly, concerned, honest). If employees trust their employer, find them supportive and open then they will be more satisfied. The finding is compatible with previous work that suggests trust is an important issue in the employee-employer relationship. H4 was supported. These models had the most consistently good fit indices. Agreeableness was positively associated with affinity, but the results contained a surprise in that ruthlessness had a significant but positive impact on managers’ affinity. Causal ordering was tested in all four relationships using alternative models where, for example, affinity is used to predict agreeableness and ruthlessness rather than vice versa. The fit levels for three models – loyalty, perceived differentiation and affinity – were not acceptable. For satisfaction there was an acceptable fit but the fit was lower than that for the relationship in the direction as originally proposed. For example for the combined database (x 2 ½df ¼ 2 ¼ 6:5, p ¼ 0:039) (CFI ¼ 0:99, GFI ¼ 0:99, Hoelter 0:01 ¼ 1; 083 and RMSEA ¼ 0:054). Testing the data in Table IV using one-way ANOVA showed that the ratings of each company varied significantly for each of the five dimensions of corporate character (p , 0:001), demonstrating that the brand images of the companies differ. Such differences can be used to “position” individual employer brands. Differently positioned product brands elicit different responses from customers; and the same is true of employees and the employer brand. Discussion and conclusions Four outcomes were selected from the consumer branding literature that should be relevant to employees – perceived differentiation, loyalty, satisfaction and affinity – to test the relevance of the employer brand concept. All four outcomes were predicted by aspects of brand personality. Agreeableness was the most prominent dimension of corporate brand personality in influencing outcomes. It dominated employee satisfaction and made the larger of two contributions to predicting affinity. Employers need to focus on this dimension in their promotion of their employer brand. But the contribution of other dimensions should not be ignored as four of the five main dimensions of corporate character were found to influence one or more of the four outcomes. Competence (reliable, leading, corporate) alone was not retained in any model. This in itself is surprising, as the competence dimension is often used by companies when trying to position themselves (Chun and Davies, 2001). Is the lack of efficacy of this dimension an indication that competence represents a hygiene factor, a dimension that in reality has little impact because few would work for an employer for long that they saw as incompetent? However, the variance of competence was no less across organisations than any other dimension (Table IV). Further work is needed to explain why, if competence is often emphasised in corporate communication (which will be seen by employees as well as other stakeholders), it has little apparent comparative benefit in positioning corporate brands to employees.


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The influence of ruthlessness was unexpected in its positive contribution to affinity. Is ruthlessness, in moderation at least, an inevitable or even a positive aspect of modern organisations? Are managers attracted to such ideas because this reflects the behaviour traits of those who would manage others? Theory suggests that people associate with brands that allow them to sustain or develop their own self-image. But neither of the two organisations with particularly high scores for ruthlessness was pleased by the finding. Further work is needed to explore how a ruthless brand can evolve and what its consequences are both for employees and customers alike. The role of chic in promoting differentiation and loyalty has face validity in emphasising the influence of prestige in employment. What is interesting and worthy of further study is why companies do not make more of this in their corporate communication or employment advertising. Chic was important in conjunction with enterprise on both occasions, implying that a combination of these two dimensions may be a key to presenting the employer brand. However, enterprise was negatively associated with loyalty, making its promotion somewhat problematic (although loyalty was not well predicted by employer brand personality). Brand differentiation in the eyes of customers makes price comparison more difficult and reduces price sensitivity. Is the same true for the employer brand? Are employees willing to trade a lower salary to work for a business they see as being more chic and agreeable? Some employers at least will be interested in investigating such a possibility. Thus far internal marketing or marketing to employees has had two main foci, especially in service industries: (1) aligning employee views of the corporate brand and their behaviour to what is being promoted externally to customers (e.g. Vallaster and de Chernatony, 2005); and (2) treating employees as “customers” who need to be communicated to, so that they have a favourable view of their employer. Internal marketing may benefit from an even wider conceptualisation (Varey and Lewis, 1999). One potential contribution from the work reported here is to emphasise how different aspects of brand image can be useful in different roles for the employer brand, an issue not identified in previous work. Satisfaction and affinity are closely correlated and agreeableness is important for promoting both. But quite different dimensions influence perceived differentiation and loyalty and, to complicate matters further, Enterprise is negatively associated with loyalty but positively associated with perceived differentiation. Enterprise may also be negatively associated with the satisfaction of more junior employees (Chun and Davies, 2006). Further, it is also believed that the internal view of the organisation may become its external image (Davies et al., 2002). While ruthlessness may promote affinity among managers it may do little to influence more junior employees in a positive way and have a more negative effect still if it influences customers and other external stakeholders alike. Clearly managing the employer brand is a complex task, an observation that leads to a final question of relevance to both employers and researchers: who should be responsible for managing the employer brand? There is some empirical evidence as to how to promote the employer brand internally (e.g. Hickerman et al., 2005) and how external promotion such as sports sponsorship may also influence employees, but no

consensus on the coordination of customer and employer branding. There are various and often competing perspectives, including expanding the role of marketing or a greater understanding of branding issues among HR professionals (e.g. Martin and Beaumont, 2003). Others argue for a new role, that of reputation manager (e.g. Davies et al., 2002), responsible for co-ordinating internal and external branding and to all stakeholders. Certainly there is value in managing the employer brand and a potential danger if no function accepts or is given responsibility for it.


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Varey, R.J. and Lewis, B. (1999), “A broadened conception of internal marketing”, European Journal of Marketing, Vol. 33 Nos 9/10, pp. 926-44. Winterton, J. (2004), “A conceptual model of labour turnover and retention”, Human Resource Development International, Vol. 7 No. 3, pp. 371-90. Wirtz, J. (2003), “Halo in customer satisfaction measures: the role and purpose of rating, number of attributes and customer involvement”, International Journal of Service Industry Management, Vol. 14 No. 1, pp. 96-119. Yeung, C.W.M. and Wyer, R.S. Jr (2004), “Affect, appraisal and consumer judgement”, Journal of Consumer Research, Vol. 31 No. 2, pp. 412-25. About the author Gary Davies is Professor of Corporate Reputation at Manchester Business School, England. He has published, inter alia, in Journal of the Academy of Marketing Science, Journal of International Business Studies, Journal of Advertising Research and Industrial Marketing Management. His books include What Price Reputation?, a study of how companies manage corporate reputation, and Corporate Reputation and Competitiveness, which covers much of the early work of the Corporate Reputation Group at MBS. Gary Davies can be contacted at: [email protected]

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