9819_Employer branding – the matching crisis and the bigger picture

Employer Branding –
The matching crisis and the bigger picture

Jacqueline Krutzler
10032185

Master of Business Administration
General Management

Dublin Business School
May 2015

II

Table of Contents

LIST OF FIGURES
……………………………………………………………………………………….. V
LIST OF TABLES
…………………………………………………………………………………………. V
ACKNOWLEDGEMENTS …………………………………………………………………………….. VI
DECLARATION
………………………………………………………………………………………….. VII
ABSTRACT ………………………………………………………………………………………………. VIII

1. INTRODUCTION AND PROBLEM DEFINITION …………………………………………………….
1
1.1. Purpose Statement
…………………………………………………………………………..
4
1.2. Research Question
…………………………………………………………………………..
5
1.3. Organisation of the Dissertation …………………………………………………………
6
2. LITERATURE REVIEW
………………………………………………………………………………..
7
2.1. Literature Review Introduction
……………………………………………………………
7
2.2. What is a Brand? ……………………………………………………………………………..
9
2.3. From Brand Image, Service Quality, …………………………………………………
11
Employee and Customer Perception to the Competitive Edge …………….
11
2.4. Branding and the Interrelationship between the Corporate Brand,
Internal Brand and Employer Brand
…………………………………………………
17
2.5. The Concept of Employer Branding ………………………………………………….
25
2.6. Employer Value Proposition …………………………………………………………….
30
2.7. The Relation between Organisational Attractiveness and
…………………….
35
Employer Branding
………………………………………………………………………..
35
2.8. Literature Review Summary …………………………………………………………….
39
3. METHODOLOGY …………………………………………………………………………………….
39
3.1. Methodology Introduction ………………………………………………………………..
39
3.2. Research Philosophy
………………………………………………………………………
41
3.3. Research Approach
………………………………………………………………………..
43
3.4. Research Strategies and Techniques ……………………………………………….
45
3.5. Research Choices and Data Collection Instruments ……………………………
47
3.6. Time Horizon …………………………………………………………………………………
48
3.7. Data collection and data analysis ……………………………………………………..
49
3.8. Selecting Respondents
……………………………………………………………………
50
III

3.9. Data Analysis Procedures ……………………………………………………………….
51
3.10. Research Ethics
……………………………………………………………………………
53
3.11. Limitations of the Research ……………………………………………………………
55
3.12. Conclusion …………………………………………………………………………………..
56
4. DATA ANALYSIS AND FINDINGS
………………………………………………………………….
57
4.1. People Services Management Team ………………………………………………..
58
4.1.1. Ethos of the Company
…………………………………………………………………..
58
4.1.2. Employer Brand Management and Employer Value Proposition …………
60
4.1.3. Organisational Attractiveness and Corporate Reputation …………………..
64
in Relation to Kempinski’s Employer Brand ………………………………………
64
4.1.4. The Impact of the Employer Brand on the Employee’s Behaviour
and Productivity
…………………………………………………………………………….
68
4.1.5. Prevention of Inconsistency and Breach of the Promise Made
to Employees ……………………………………………………………………………….
71
4.2. Employees Perception on Kempinski’s Employer Brand
………………………
72
4.2.1. Association with the Brand Kempinski and the Perception of
the Company’s Employer Brand ……………………………………………………..
72
4.2.2. The Main Reason to Work for the Hotel Palais Hansen Kempinski,
Brand Image and Job requirements
…………………………………………………
74
4.2.3. The Influence and Effect of the Employer Brand on
an Employee’s Performance and Decision-Making ……………………………
76
5. DISCUSSION …………………………………………………………………………………………
79
5.1. Ethos of the Company …………………………………………………………………….
79
5.2. Employer Brand Management and Employer Value Proposition …………..
81
5.3. Organisational Attractiveness and Corporate Reputation …………………….
85
in Relation to Kempinski’s Employer Brand ………………………………………..
85
5.4. Employee’s Perception of
the Employer Brand Hotel Palais Hansen Kempinski …………………………..
88
5.5. Limitations of the Research ……………………………………………………………..
89
6. CONCLUSION AND RECOMMENDATIONS ………………………………………………………
90
6.1. Recommendations for Future Research
…………………………………………….
94
6.2. Managerial Implications
…………………………………………………………………..
95

IV

7. REFERENCES
………………………………………………………………………………………..
97
8. APPENDICES
……………………………………………………………………………………….
107
8.1. Appendix 1 – Reflection
…………………………………………………………………
107
8.2. Appendix 2 – Employer Branding Questionnaire
……………………………….
111
8.3. Appendix 3 – Employee Questionnaire …………………………………………….
113
8.4. Appendix 4 – CONSENT FORM FOR PARTICIPANTS
……………………..
115
8.5. Appendix 5 – Customer Satisfaction Survey (CSS) …………………………..
117

V

List of Figures

FIGURE 1: THE BRAND SYSTEM ………………………………………………………………………….
11
FIGURE 2: THE SERVICE BRAND-RELATIONSHIP-VALUE TRIANGLE
……………………………….
14
FIGURE 3: ILLUSTRATION OF THE RELATIONSHIP BETWEEN A UNIQUE AND ATTRACTIVE
EMPLOYER BRAND AND THE BRAND RELATED BEHAVIOUR OF EMPLOYEES,
AS SEEN THROUGH THE LENS OF SIA ……………………………………………………
15
FIGURE 4: INTEGRATED BRAND MODEL ……………………………………………………………….
18
FIGURE 5: PROPOSED FRAMEWORK OF INTERNAL BRANDING PROCESS ……………………..
22
FIGURE 6: CIRCLES OF LOVE: LINKING EMPLOYEES TO THE CUSTOMER PROPOSITION
……
24
FIGURE 7: EMPLOYER BRAND EXPERIENCE FRAMEWORK ………………………………………..
24
FIGURE 8: EMPLOYER BRANDING AND TALENT-RELATIONSHIP-MANAGEMENT:
……………..
26
IMPROVING THE ORGANIZATIONAL RECRUITMENT APPROACH ……………………
26
FIGURE 9: INTEGRATED SERVICE BRAND MODEL …………………………………………………..
27
FIGURE 10: THE EMPLOYER BRAND IN ACTION ……………………………………………………..
32
FIGURE 11: THE MODEL OF BRAND ADVOCACY & LOYALTY ……………………………………..
34
FIGURE 12: EMPLOYER BRANDING FRAMEWORK
……………………………………………………
36
FIGURE 13: REVISED CONCEPTUAL FRAMEWORK FOR EMPLOYEE-BASED BRAND EQUITY 38
FIGURE 14: THE RESEARCH ONION ……………………………………………………………………
40
FIGURE 15 DATA ANALYSIS IN QUALITATIVE RESEARCH ………………………………………….
51
FIGURE 16: THE EMPLOYEE EXPERIENCE CYCLE
…………………………………………………..
62
FIGURE 17: ESS – OVERVIEW OF THE EMPLOYEE SATISFACTION SURVEY
…………………..
64

List of Tables

TABLE 1: IMPORTANT FACTORS IN MAKING THE DECISION TO WORK FOR
THE HOTEL PALAIS HANSEN KEMPINSKI
………………………………………………….
78

VI

Acknowledgements

Many people have played a significant part in shaping this Master Thesis but it would
have been impossible without the contributions made by the following people.
Therefore, I would like to express my sincerest appreciation to all people who
supported me in writing my Master Thesis.

A special gratitude to my supervisor Gay White for supporting me with her insights,
academic and ethical advices as well as her valuable guidance and encouragement
through the learning process of my Master Thesis. I would also like to extend my
gratitude to all of the lecturers in the Dublin Business School under whom I studied
with a particular thank you to Clare Devlin as well as to the Dublin Business School
team.

Furthermore, I would like to thank the participants of my semi-structured interviews,
who have shared their precious time, expertise, knowledge and illuminating views
with me. I am sincerely grateful for the time and the effort in contributing towards my
thesis.

I express my deepest gratitude to my loved ones, my family, in particular my parents,
Helmut and Stephan, who have supported and motivated me throughout the entire
process as well as for their unceasing encouragement and unwavering believe in
me.

I would also like to express my heartfelt thank you to my extended family in Dublin,
Micaela and Tanaka, for their inspiration, relentless belief in me, constructive
criticism, valuable and enlightening advice and discussions throughout the course of
my Master degree.

Finally, I would like to thank all of my friends for their support, encouragement and
kind wishes throughout the process of my Master degree.

VII

Declaration

I, Jacqueline Krutzler, declare that I have developed and written the enclosed Master
Thesis completely by myself. It is being submitted to fulfil the requirements of the
Master of Business Administration at the Dublin Business School. No part of this
work has previously been submitted in support of an application for a degree or
qualification at this or any other college/university.
Furthermore, all the work in this dissertation is entirely my own, except referenced in
the text as a specific source and included in the bibliography.
___________________________
Jacqueline Krutzler
22nd of May 2015

VIII

Abstract

Markets without boundaries, a fast-paced global economic business environment,
technological advances and demographic shifts due to population growth or decline
mark a new era of disruptive change. These factors are changing the behaviours and
the way relationships between people and companies are formed. While people think
that running an organisation is about growth, innovation and salesmanship, the
reality is that an organisation’s ultimate success stems from attracting, recruiting,
engaging and retaining passionate and skilled people. Employees are the most
important asset and build the foundation of a company’s success. The concept of
employer branding represents a company’s reputation as an employer and embodies
a company’s effort to promote a unique, distinctive and desirable employment
offering, both within the company to existing employees and outside the company to
potential prospective candidates. Employer brand management takes a more holistic
approach to shape the culture of a company and employees everyday experience of
the brand by aligning the brand ethos with every employee’s touch-point. Nowadays,
employers worldwide recognise the huge impact employees have on a customer’s
service experience and satisfaction, which in turn leads to business growth. This
thesis aims to identify and discuss the impact of employer branding on an
employee’s perception in regard to the organisational attractiveness, the corporate
brand and on productivity.
The literature reviewed provides a concise outline to the concept of employer
branding including branding, the corporate brand and the internal brand, corporate
culture, organisational attractiveness and reputation as well as service quality. The
thesis is descriptive and uses a qualitative, inductive approach. The strategy chosen
for this thesis was a single case study that uses the Hotel Palais Hansen Kempinski
as its object of study. A mono-method of semi-structured interviews was undertaken
for the purpose of collecting the primary data. The interviews were conducted from
different levels of the company, from the Director of People Services to the Chef de
Bar in order to provide a clearer perspective on the impact of employer branding on
the employee’s perception. The findings indicate that a distinctive and unique
employer brand positively influences an employee’s perception of the organisational
attractiveness, the corporate brand and the productivity.
1

1. Introduction and Problem Definition
“An idea can turn to dust or magic depending on the talent that rubs against it.”
(Bill Bernbach, cited in Mosley, 2014, p. 143)

Talent is “the main engine of business” and CEOs try to find and secure the right
talent to drive their future success. The 17th PWC’s Annual Global CEO Survey
revealed a 5% increase in the threat to finding potential employees who are skilled.
While in 2013 58% of CEOs expressed their concerns only 53% did so in 2012.
Furthermore, 93% of the participants realised that in order to attract and secure new
talents they would have to change and redefine their strategies. This reveals a new
but important way of thinking in today’s service and knowledge-driven economy.
Employees are the most important assets and 64% of CEOs say, “… creating a
skilled workforce is a priority for their organisation over the next three years.” (PwC,
2014, pp. 18-22).

2015 marks a new era of disruptive change and of a market without boundaries,
which will significantly affect and reshape the global market (PwC, 2015, p. 2). In the
latest edition of PWC’s Annual Global CEO Survey, CEOs worldwide believe that
three trends will transform the business environment in the coming five years. 81%
of the participants mentioned technological advances such as the increase of the
digital economy, social media and mobile devices; trends which are not new but are
progressing at a much higher pace and keep creating a different environment. 59%
of the participants stated their concern in the shift of the global economic power in
regards of resource and competency shortages and 60% of the CEOs named the
demographic shifts due to population growth or decline. These demographic shifts
are causing a major redistribution of the global workforce, which will not only have a
massive influence on the workplace but will also impact the future consumption
patterns (PwC, 2014, pp. 10-11).

2

In our fast moving environment, markets are extremely competitive and products and
services are becoming more homogenous. Today’s business landscape is driven by
shorter product lifecycles, increasing customer requirements and greater
technological complexities. Products and services are threatened more than ever by
substitutions and innovations. In order to stay competitive, companies are forced to
rethink their roles and differentiate themselves. Not everything revolves around
products and services anymore, customers seek values and value creation. Evolving
trends in lifestyle, technology and social influences are changing behaviours and the
way relationships between people and companies are formed. Employees make the
critical difference between the success and failure of a company. Sergio Zyman, the
Chairman and Founder of Zyman Group highlighted: “Before you can think of selling
your brand to customers, you have to sell it to your employees. How the brand is
positioned in the minds of consumers is heavily dependent on a company’s
employees.” (Zyman, cited in Minchington, 2006, p. 5)

The idea of building an organisation’s reputation through a company’s brand as an
employer is referred to as “ employer branding”, which was first introduced by
Ambler and Barrow in 1996, who defined the concept as “the package of functional,
economic and psychological benefits provided by employment, and identified with
the employing company” (Ambler and Barrow, 1996, p.187). The interest in employer
branding highly increased after the publication of Ambler and Barrow’s article “The
Employer Brand”. Employees make the critical difference between success and
failure. In order to attract and retain appropriate employees with the right skill set,
companies started to use the practices and principles of branding in the area of
human resource management. The effectiveness with which organisations manage,
develop, motivate, involve and engage the willing contribution of their employees,
who work in the business, is a key determinant of how well those organisations
perform. In our competitive world, talent management is an important driver for an
organisation’s success.

“Why is employer branding so popular now? The answer seems to be obvious. In a
situation where there is a highly competitive labour market and population decline,
firms worldwide need to attract and retain qualified, value-adding employees.”
(Kucherov and Zavyalova, 2012, p. 88)
3

In essence, this thesis aims to identify and discuss the impact of employer branding
on an employee’s perception in regard to the organisational attractiveness, the
corporate brand and on productivity.

The literature reviewed provides a concise outline to the concept of employer
branding including branding, the corporate brand and the internal brand, corporate
culture, organisational attractiveness and reputation as well as service quality. The
thesis is descriptive and uses a qualitative, inductive approach. The strategy chosen
for this thesis was a single case study that uses the Hotel Palais Hansen Kempinski
as its object of study. A mono-method of semi-structured interviews was undertaken
for the purpose of collecting the primary data. The interviews were conducted from
different levels of the company, from the Director of People Services to the Chef de
Bar in order to provide a clearer perspective on the impact of employer branding on
the employee’s perception. The findings indicate that a distinctive and unique
employer brand positively influences an employee’s perception of the organisational
attractiveness, the corporate brand and the productivity. The semi-structured
interviews revealed that the case company, Hotel Palais Hansen Kempinski, has a
very strong employer brand, where the company’s perceived image as “a great
employer to work for”, and thus the expectations of potential and existing employees’
are aligned with the actual values and the culture, which positively affects employee
retention, attraction, loyalty, motivation, engagement and productivity.

4

1.1.
Purpose Statement
Evolving trends in lifestyle and technology are changing the behaviours and the way
relationships between people and companies are formed. Employees, as well as
customers, are no longer passive recipients. People hunger for uniqueness and for
possibilities that will help them to express their individuality in an impersonal world.
Due to the past economic turmoil the concept of employer branding has gained an
increasing interest and plays an important part in attracting and retaining talent. “The
War for Talent” is an on-going process and companies seek to become the employer
of choice. In 1998, McKinsey studied 77 U.S. companies from a variety of industries
and stated in the report “The War for Talent” that companies are struggling to attract,
engage and retain good employees and forecasted that this occurrence will continue
(Chambers et al., 1998, pp. 44-46). The quote in the McKinsey Quarterly in 1998
marks the advent of employer branding and has initiated and driven the change in
the HR field. The quote can be read as follows:

“Companies are about to be engaged in a war for senior executive talent that will
remain a defining characteristic of their competitive landscape for decades to come.
Yet most are ill prepared and even the best are vulnerable.” (McKinsey, 1998, cited
in Barrow and Mosley, 2005, p. 37)

Employer branding is a powerful tool to develop a sustainable competitive advantage
in today’s increasingly competitive marketplace. The concept aims to externally, as
well as internally, highlight the positive aspects of working for an organisation with
the intention to attract new, potential employees as well as to engage and retain the
current ones (Minchington, 2006, pp. 26-43). “Companies who can attract the best
minds will have a distinct edge in the marketplace.” (Harari, 1998, cited in
Minchington, 2006, p. 98) Therefore, companies need to develop new strategies in
order to be viewed as valued companies where employees seek to work in order to
stay successful and survive in the highly competitive business environment.

5

With a strong employer brand a company will be able to attract, develop and retain
talented people who are willing to invest their knowledge and skills in the business
objectives, which further contributes to the competitive advantage and leads to an
increasing performance.

1.2.
Research Question
This research hopes to identify the impact of employer branding on an employee’s
perception in regard to the organisational attractiveness, the corporate brand and to
productivity and therefore the research question is as follows:

What impact does employer branding have on an employee’s perception of the
organisational attractiveness, the corporate brand and on productivity?

6

1.3.
Organisation of the Dissertation
The organisation of the dissertation is in the following manner:

Chapter One: The first section represents an overall introduction to the research in
the field of employer branding and the present standing in today’s knowledge-driven
business environment. Furthermore, the purpose of the research and the research
question is outlined and the reader is introduced to the organisation of the
dissertation.

Chapter Two: The second chapter encompasses the literature review and examines
how employer branding and talent attraction impact and influence the organisational
attractiveness, employee productivity and the corporate brand. Therefore, a number
of articles, journals, books, and surveys were analysed in order to collect relevant
literature, to present a variety of different viewpoints and to state what have been
researched so far in the field of employer branding.

Chapter Three and Four: Furthermore, these sections three and four outline the
research methodology and the data analysis. Section Three outlines the research
methodology, justifies and illustrates the research approach and methods which
have been applied for the thesis in order to research the role of employer branding
and the matching crisis and its impact on the Hotel Palais Hansen Kempinski.
Section Four outlines the data analysis, and presents the findings of the semi-
structured interviews.

Chapter Five: Section Five outlines the discussion on the research undertaken. The
research topic is assessed by comparing and contrasting the findings with
contemporary literature and draws a general conclusion from the results through a
summary of the findings and clarifies the link with the concepts that have been raised
in the literature review. Finally, section five closes with the limitations of the research.

Chapter Six: Section Six encompasses the recommendation and conclusion about
the relevance and the validity of the outcomes and illustrates how the research has
contributed toward the area of employer branding as well as managerial implications.
7

2. Literature Review
The purpose of this literature review is to establish, define and link different theories
to the employer branding concept. This chapter illustrates the relevant theories,
concepts and the interrelationship surrounding employer branding. The researcher
outlines the four main sectors; namely branding and the interrelationship between
corporate branding, internal branding and employer branding, the concept of
employer branding, the organisational attractiveness regarding the employer brand
and the influence on employee productivity.

2.1.
Literature Review Introduction
This chapter investigates literature from a variety of sources, including scientific
literature from academia as well as industry and company reports. The concept of
employer branding originates from the field of brand management (Moroko and
Uncles, 2008, p. 160) and is an extension of relationship marketing principles, which
identifies the need to build attraction and retention strategies across relevant
stakeholders through stronger relationships (Ambler and Barrow, 1996, p.186). The
success of the concept is heavily dependent on a company’s culture and values as
well as on the employment experience (Moroko and Uncles, 2008, pp. 160-161).
Therefore, the key areas of this thesis revolve around branding, corporate branding,
internal branding, the concept of employer branding and organisational
attractiveness.

Due to demographic and structural changes, mainly in developed economies, which
are followed by a volatile talent demand-supply and a tightening of the labour
market, companies are forced to rethink their talent and employment management
strategies. The concept of employer branding is rather new and represents a critical
success factor for companies striving for a sustainable competitive advantage in the
tightening of the labour market (Franca and Pahor, 2012, pp. 79-80; Botha, Bussin
and De Swardt, 2011, p. 299).

8

Deloitte’s longitudinal survey illustrates that successful companies place a high
importance on employer brand management and the retention of talent. Companies
with retention plans in place reported an increase in their financial and non-financial
incentives and more than 71% of companies will increase their focus on employer
branding and develop high-potential employees and emerging leaders in the
following years (Deloitte, 2010).

Despite the gaining popularity of the concept, few academic literature and articles
have been published. The notion of “employer branding” was first mentioned by
Richard Mosley (1990), who originally invented the concept. Additionally, most of the
research regarding employer branding is based on the research and work of
Backhaus and Tikoo (2004), Barrow and Mosley (2005), Minchington (2006), Mosley
(2007, 2009 and 2014), Rosethorn (2009) and Moroko and Uncles (2008 and 2009).

9

2.2.
What is a Brand?
A brand is “… a name, a term, a symbol, or any other unique element of a product
that identifies one firm’s product(s) and sets it apart from the competition.” (Solomon,
Marshall and Stuart, 2008, p. 286) Similar to Solomon, Marshall and Stuart, Kotler et
al. (2012, p. 467) highlight the use of brands as a signalling system to generate and
send an emotional meaning, which in turn leads to add value to the company and
distinguishes it from competitors. Kotler et al. (2012, p. 467) define a brand as a
“…name, symbol, logo, design or image, or any combination of these, which is
designed to identify a product or service and distinguish it from those of their
competitors.”

A multitude of definitions exist and experts are in constant disagreement concerning
the definition of “the brand”. Two key schisms between the two paradigms exist. One
paradigm is “customer-based” and focuses on the relationship customers have with
the brand. On the basis of this perspective, Keller (1998, cited in Kapferer, 2008, p.
10) defines a brand as “a set of mental associations, held by the consumer, which
add to the perceived value of a product or service.” The definition places a great
emphasis on a customer perceived value created by the brand. The other paradigm
is concerned with a brand’s financial value (Kapferer, 2008, pp. 9-11). The growing
awareness of the ability of a well-known brand to contribute to the asset value of a
company began to arise in the late 1980s. The notion of brand equity was born,
which is the added value with which the brand enriches a product or service
(Rosenbaum-Elliott, Percy and Pervan, 2011, pp. 89-91; Kapferer, 2012, p. 441;
Kotler et al., 2012, p. 492; Clifton, 2009, p. 246).

Nowadays, brands are a vital source of differentiation, especially in saturated
markets. A brand represents more than just a service or a product. A strong brand
creates an emotional reaction (Solomon, Marshall and Stuart, 2008, pp. 287-288).
Furthermore, brands act as a relationship builder between a service organisation and
its customers (Kasper, Van Helsingen, Gabbott, 2006, p. 163).

10

As previously mentioned, different interpretations of the term “brand” exist and the
notion of brands as a promise is particularly suitable for service branding because of
their characteristics of heterogeneity and intangibility (De Chernatony and Segal-
Horn, 2003, p. 1098). Therefore, Ambler and Styles (1996, p. 10) define a brand as
follows: “… the promise of the bundle of attributes that someone buys … the
attributes that make up a brand may be real or illusory, rational or emotional, tangible
or invisible.”

In accordance with recent marketing literature, the importance of involving a variety
of stakeholders to generate a unique position not only on the customer market but
also on the labour market greatly impacts a company’s performance but most
importantly, companies have recognised that their greatest asset are the people who
work for them (Foster et al., 2010, p. 401; Mosley, 2007, pp. 124-125; Gaddam,
2008, p. 45). Therefore, a vital role of brand management represents a more
employee-centric and unified view when it comes to external as well as internal
communication (Barrow and Mosley, 2005, p. 151). Furthermore, a strong corporate
brand is characterised by a strong employer brand due to its alignment with the
corporate culture, which is closely connected to the brand image and the ability to
immerse employees’ in the brand experience (Moroko and Uncles, 2008, pp. 160-
161).

11

2.3.
From Brand Image, Service Quality,
Employee and Customer Perception to the Competitive Edge
“If anyone can build a brand, it is the customer. Marketers cannot do that. They can
only create favourable conditions for a brand image to develop in customers minds.”
(Grönroos, 2007, p. 329)

The term “brand image” is the image of the product or service, which is formed in the
minds of the customers (Grönroos, 2007, p. 330). The brand image plays a crucial
role in creating customer satisfaction, which stems from relationships and
representations. Furthermore, the brand image is an interconnected system of
association, which Kapferer (2008, p. 11) named the brand system. The brand
system is illustrated in Figure 1 and consists of three vital elements: the brand
concept, including the value proposition with its tangible and intangible elements, the
brand name and its symbol and the service or product experience.

Figure 1: The brand system
(Kapferer, 2008, p. 12)

Kapferer (2008, pp. 11-12) accentuates the power of a brand’s name, which heavily
depends on the cumulative brand experience and states that a brand is “… an
attitude of non-indifference knitted into consumers hearts.” Therefore, a strong brand
has the power to influence the market through its product or service, in cooperation
with the people who are in contact with the market as well as the price, the
communication and the places (Kapferer, 2008, pp. 12-13).
12

In addition to that, De Chernatony (1999, pp. 172-173) argues that the brand is a
more powerful tool compared to the brand image, which is focused on the most
recent impression. The brand reputation assesses perceptions across many
stakeholders (De Chernatony, 1999, pp. 172-173) and it is assumed that a close
relationship between the employer brand image and the reputation of a company’s
products and services exist due to good external brand experiences (Barrow and
Mosley, 2005, p. 149). Mosley (2014, p. 81) refers to the external reputation of a
company as “clusters of associations”, which play a vital role to a company’s external
perception and represents a significant characteristic of the employer brand equity
and talent pool (Mosley, 2014, pp. 81-90). Gaddam (2008, p. 48) complements
Mosley’s statement and adds that a company’s reputation and brand image integrate
not only the employer brand but also the employee brand. Both play a major role
when it comes to attracting, recruiting, engaging and retaining employees. Employee
and employer brand should be balanced and interrelated to contribute to the
competitive edge and coin the customer experience. Furthermore, the alignment of
both can play a pivotal role in “future-proofing” the corporate reputation (Martin,
Gollan and Grigg, 2011, p. 3619).

Mosley (2014, pp. 81-90) identified three major factors when it comes to the
perception of the company as a potential employer; namely the industry image,
leading talent competitors in relation to the standing of the company and if the target
talent wants to work for an established company or for a start-up. The last but highly
significant factor is attraction. A number of sources for attraction data exist but the
most insightful are Towers Watson’s Global Workforce Study, Corporate Executive
Board’s Global Workforce Survey and the Talent Flow Analysis by LinkedIn. Those
studies revealed that the predominant drivers of attraction by far are work-life
balance, compensation and job security (Mosley, 2014, pp. 81-90). Similar to
organisational brand communications with its consumers where consumers buy a
“holistic package of benefits”, including psychological and economic satisfaction,
employer brands communicate the benefits of employment to potential employees.

13

The benefits employer brands offer, such as psychological (feelings of belonging,
purpose), functional (developmental activities, leave allowances) or economic
satisfaction (monetary rewards) to employees, are in parallel with brand offers to
customers (Ambler and Barrow, 1996, p.187) and reinforce the employer brand’s
positioning, which further leads to strengthening the value of the employer’s
proposition (Moroko and Uncles, 2009, p. 182).

Foxall, Goldsmith and Brown (2005, p. 51) and Grönroos (2007, p. 331) add that a
customer’s perception about a brand stems from the received information about the
brand characteristic. Perceived quality is a central consideration in almost every
customer’s choice context and therefore has a tremendous effect on a company’s
competitive advantage (Aaker, 1996, p.123). To remain successful in today’s
dynamic and fast-paced business environment, service experience and service
quality is considered to be imperative in order to continuously improve and is
therefore viewed as a key component by organisations (Parasuraman et al., 1985,
cited in El-Said, 2013, p. 292). In order to maintain a high service quality, employee
satisfaction plays a major role in providing customer satisfaction and is one of the
most important drivers for quality and productivity (Zeithaml et al., 1990, pp. 90-91;
Matzler and Renzl, 2006, p. 1261).

Furthermore, Matzler and Renzl (2006, p. 1261) state that employee satisfaction
directly affects process quality, and in turn, determines customer satisfaction and
quality costs. In the service industry, a positive relation can be seen between
satisfied employees, customer loyalty and satisfaction and the company’s
performance (Heskett et al., 1994, pp. 164-165). One well-known conceptualization
which illustrates the interrelationship is the ‘service-profit chain’ developed by
Heskett et al. (1994, p. 166). This encompasses several factors, including employee
satisfaction, which results from the company’s policies, support and procedures and
enables employees to deliver services to meet customers’ needs. This value creation
increases customer satisfaction and loyalty, which leads to profit and growth.

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In the context of the nature and process of services, Brodie et al. (2006, p. 372)
developed the service brand-relationship-value triangle in order to identify and
understand the multi-faceted elements of the brand creation process. The model is
based on the promise concept and is illustrated in Figure 2.

Figure 2: The service brand-relationship-value triangle
(Brodie, Glynn and Little, 2006, p. 372)

The model demonstrates the importance of alignment and integration between the
brand promise, which is externally communicated and the company’s internal actions
in order to fulfil the expectations created by the promises made. In its essence, the
external communicated brand values have to be aligned with the internal values
(Brodie, Glynn and Little, 2006, p. 372; Grönroos, 2007, pp. 337-338; Sirianni et al.,
2013, pp. 108-109). Einwiller and Will (2002, pp. 107-108) accentuate the
fundamental implicitness of integrating the employer brand in other business
activities and incorporating the concept in the corporate communication and the
corporate brand.

15

The employer brand supports the creation of identity among current employees to
“live the brand”, which positively influences customers’ responses to brands and
attracts future employees’ (Gaddam, 2008, p. 46; Martin, Gollan and Grigg, 2011, p.
3619; Barrow and Mosley, 2005, p.134). In order to “live the brand”, Barrow and
Mosley (2005, p. 134) emphasise the importance of ensuring that the relevance of
the brand is aligned with the employment experience.

Furthermore, the Social Identity Approach to Organisational Identification (SIA)
underpins the notion of “live the brand” approach and demonstrates how an
attractive employer brand can influence an individual’s behaviour and identity within
its own self-concept which in turn leads to an employee’s engagement and reflection
of a company’s unique identity (Maxwell and Knox, 2009, pp. 896-897).

Figure 3: Illustration of the relationship between a unique and attractive employer brand
and the brand related behaviour of employees, as seen through the lens of SIA
(Maxwell and Knox, 2009, p. 897)

For decades, researchers and practitioners placed significant emphasis on the
interaction between brands, potential customer and consumers and less on the
interaction between the brand and employees (De Chernatony, 1999, pp. 157-173;
Rampl and Kenning, 2012, pp. 218-219). Recently, the scope of marketing
management has been broadened in order to encompass other stakeholders, in
particular employees, suppliers, the local community and many more (Rampl and
Kenning, 2014, p. 219).

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The success of a company and its sustainable competitive advantage depends on a
clear competitive strategy on whether the company should compete on cost or
differentiation and its distinctive capabilities (Mosley, 2014, pp. 49-52). Porter’s
generic strategies provide a useful framework for analysing the industry and the
company’s competitive advantage. While the competitive advantage incorporates
technology, organization and people, it is the people-driven process that leads to a
sustainable competitive advantage (Thompson and Martin, 2010, pp. 205-207).
Johnson et al. (2014, pp. 70-73) emphasise that strategic capabilities, in view of
resources and competences, are vital for a superior performance and are key
elements in an organisation’s long-term survival.

Marketers realised that there is more required in order to develop and manage a
successful brand than understanding customer needs and desires. Underlying
technical and organisational capabilities combined with a good knowledge of the
market dynamics contribute to a brand’s competitive edge (Barrow and Mosley,
2005, p. 87). On one hand, attracting and retaining skilled people helps a company
to compete in the “war for talent” and on the other hand, employing qualified and
talented employees leads to a high service quality being delivered to satisfy
customer needs (Rampl and Kenning, 2014, p. 219).

Considering employees as a vital part in the brand building process led to a stronger
brand performance. De Chernatony places a great emphasis on the alignment of
employees’ values and behaviours with the brand values and the purpose of a
company in order to develop a powerful brand (De Chernatony, 1999, pp. 157-173).
Furthermore, De Chernatony (1999, p. 172) states that “…brands are clusters of
values and, particularly for corporate brands, these values emanate from people
inside the firm”.

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2.4.
Branding and the Interrelationship between the Corporate Brand,
Internal Brand and Employer Brand
Brands play a vital part in modern society. They shape, influence and penetrate all
spheres of people’s lives. In developed economies, customers drive the business
and have a wide array of choices.

This array and diversity of choices put a lot of pressure on marketers to differentiate
themselves and secure their competitive advantage (Blackett, 2009, p. 17). Clifton
(2009, p. 252) adds “Competing successfully in the 21st century will require more
than just outstanding product and quality functions. Intangibles, such as corporate
and brand image, will be crucial factors for achieving a competitive advantage.” In a
nutshell, “a brand exists when it has acquired the power to influence the market.”
(Kapferer, 2012, p. 9) To create value, influence the market and gain market share,
the whole system, such as the product or service, combined with the people at points
of contact with the market and all the sources of cumulative brand experience, have
to make a name and a set of proprietary signs in order to acquire the power of a
brand. Successful brands create an image in the mind of the customer, are
perceived as unique and differentiate themselves from their competitors (Kapferer,
2012, p. 9).

Nowadays, the focus does not lie on a brand’s functional role but rather on its
emotional role. Emotions play a significant role in customers’ selection, loyalty, and
satisfaction towards brands (Kotler et al., 2012, pp. 467-469). The importance of the
link between brands and personal identity has grown significantly. Brands operate as
enablers by making it possible for people to create whatever identity they wish to
create and adopt (Fanning, 2006, pp. 30-31). In today’s pace of change, the success
of a company can no longer rely on out-dated tools and structures. Branding is not
solely focused on advertising; on the contrary, it is a driving force to achieve and
infuse a company with their vision. To create a sustainable advantage, companies
need to focus on an integrated branding process and adapt their tools to react to
continuous market changes. The integrated branding process is aligned with the
strength and culture of the company and links brand clarity, organisational alignment
and communications (LePla, Davis and Parker, 2003, pp. 11-16).