Proceedings of 3rd Asia-Pacific Business Research Conference

advertisement
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
Introduction to SMEs in Malaysia: Growth Potential and
Branding Strategy
Tock Jing Mi* and Rohaizat Baharun**
There was very little study about the growing SMEs industry in Malaysia
previously, neither a standard definition nor the growth potential that small
medium enterprises have. Many of the previous studies have focused on the
degree of issues and challenges faced by SMEs and to a lesser extent on
the maximum growth potential that SMEs in this country has. Different
nations have utilized diversified strategic tools and resources that they have
to fit into a particular concept or situation. Tak ing into account the growth
potential in the area that one country has, strategies implemented would be
different. Japan is famous for its technological advances in motors; America
has borne out successful inventors to create machines to ease people’s
lives and China is now the biggest manufacturing mark et that most of the
products are made there. Malaysia has dissimilar potential as well. Too
much was engrossed on standardization than branding adaption or mainly
strategies being implemented among the businesses. Hence, this paper will
reveal the general idea about SME, the growth potential that this country has
and to use and tak e it to higher levels of efficiency by instigating the right
branding strategy. Getting started in Malaysia is just half the battle of an
entrepreneurship, the latter of becoming bigger and better will come
eventually.
Field Of Research: Management
Introduction
Small medium businesses are growing tremendously in the international context yet have so
far received only scant attention especially in Malaysia. Main considerations are given unto
the larger organizations predominantly known as multinational companies (MNC). They are
acknowledged and recognized for superiority in terms of better branding as compared to
SMEs branding. According to a case study done by Fauziah and Baharun (2010) the recent
9th Malaysian Plan shows that even though there are commercial establishments in SME
category, the brands are still struggling in the global arena. Why is there still a struggle when
Malaysia is rooting towards a developed nation? Branding amazingly was rarely being
studied among small businesses (Ahonen M., 2008). This portion of brand is the core of the
small business where it serves to highlight and compress company‘s fundamental products
and services. Today, brand represents reputation, status and the experience promised to give
to be it upper level, middle income or lower income customers in the society. Looking at the
possible great future that Malaysia has towards SMEs, branding should be critically the
central notion to pay attention to. Progressing plans towards the elevation of entrepreneurship
is must to boosting economic growth and development of a nation.
* Tock Jing Mi, Faculty of Management & Human Resource Development , Universiti Teknologi Malaysia
Email:[email protected]
**Professor Madya Dr Rohaizat Baharun, Universiti Teknologi Malaysia, Malaysia
Email:[email protected]
1
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
Establishment of Small Medium Sized Enterprises in Malaysia
The existence definition of small medium businesses in Malaysia ten years ago can be near
zero. Previously, there was neither standard classification as to what Small and Medium
Enterprises (SMEs) were nor the accepted universal concept of SMEs. Ideally, there is
almost an absence of unanimity on the definition itself (Gibb, 1993; Curran and Blackburn,
2001) as every nation describes SME in a different way. Although there is a no conjunction of
the meaning of SME, however in certain degree of criteria, Malaysia in fact has adopted a
common definition to expedite the various sectors whereas in industrialized countries for
instance the European Union the SMEs are the companies that employ less than 500
employees (Eyre and Smallman, 1998). According to the National development Council
(NSDC) in 2005 as long as a company meets the principles of the annual sales turnover and
number of employees it should be categorized microenterprise, small or medium sized
enterprises shown in Table 1. These standards apply to all sectors such as agriculture,
manufacturing and services.
Table 1: Categorization of SMEs 2012
Category
Microenterprises
Manufacturing,
Sales turnover of less
Manufacturing
than RM250, 000 or full
related service and time employees less
Agro-based
than 5.
industries
Small
Sales
turnover
between RM250,
000 and RM10
million or full time
employees
between 5 and 50.
Services,
Primary
Agriculture
and
Information
and
Communication
Technology (ICT)
Sales
turnover
between RM200,
000
and
RM1
million or full time
employees
between 5 and 19.
Sales turnover of less
than RM200, 000 or full
time employees less
than 5.
Medium
Sales
turnover
between
RM10
million an RM25
million or full time
employees
between 51 and
150.
Sales
turnover
between
RM1
million an RM5
million or full time
employees
between 20 and
50.
Source: http://www.smecorp.gov.my/v4/node/14
The entire market of SMEs comprises mainly on services sector up to 90% of the total
establishments shown in Table 2. The concentration in the services sector in fact has
increased as compared to the previous year. Services sector includes distributive trade subsector (wholesale & retail trade services), including repair of motor vehicles and motorcycles,
food and beverages services and transportation& storages services, private services such as
beauty and spa center, lodging, health and also education. In 2011, the two additional sectors
included were construction and mining & quarrying. This sector registered the highest
average annual income associated with stone quarrying business.
There are many supporting organizations in Malaysia which have specific roles in
safeguarding the execution of programs targeted at developing SMEs and connecting
Malaysian SMEs with large, local or foreign owned corporations (Hashim & Wafa, 2002; Mori
2
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
2005; Zizah et al, 2010). The biggest supporting organization players of SMEs in Malaysia
are Ministry of International Trade and Industry (MITI) to help and protect Malaysian interest in
the international trade arena and spurring the development of industrial activities. Malaysian
Industrial Development Association (MIDA) incorporated under Malaysian Investment
Development Authority Act is the government's principal agency for the promotion of the
manufacturing and services sectors in Malaysia ensuring economic transformed to better.
Other supporting government agency is the Small and Medium Industries Development
Corporation (SMIDEC) which responsible to expand skilled and resilient Malaysian SMEs to
be able to compete globally. MATRADE (Malaysia External Trade Development Corporation)
has mission to promote Malaysia‘s export is part of the growth of SME where this institution
helps many local companies to carve new edges in global markets.
Table 2: Number of Establishments by Sector
Sector
Manufacturing
Services
Agriculture
Construction
Mining & Quarrying
Total
Total SME
37,861
580,985
6,708
19,283
299
645,136
Total SME (% )
5.9
90.1
1.0
3.0
0.05
100
Source: Economic / SMEs Census 2011 by Department of Statistics, Malaysia
The Growth Potential of Small Medium Businesses
Small Medium Enterprises contribute large growth potential in many countries. For instance in
Nigeria, SME provides jobs to individuals (Emmanuel et al, 2012) in Pakistan the entire
economy is highly dependable on the pace and productivity of SMEs. SMEs provide labour
force and contribute mainly on the export of manufacturing goods and GDP. All are based on
the consequence of business efforts of SMEs (Saeed, 2005). What about in Malaysia?
According to SMIDEC in Malaysia 2012, 94% of companies in the manufacturing sector are
SMEs contributing 32% to GDP and employ 56% of the workforce (excluding the
Government) which makes up nearly 20% of Malaysia‘s total export. (Rosli, 2012) Malaysian
SME has remained steady and strong despite the challenging year.
Malaysia is Located in Southeast Asia, one famous developing country explicitly supporting
SME to be globally connected. A multi-ethnic and polyglot country, Malaysia has major
advantages of being political stable with first-class physical infrastructure (The NST, 2006) is
competitive in attracting direct foreign investments and is among the world‘ s top 20 trading
nations (FMM Directory, 2005). In the recent few years, the very rapid change has happened
in the states of Johor Bahru especially under Iskandar Developments. Many enlargements are
made in entertainment parks for instance Legoland, Hello Kitty Land, realty estates, more
shop lot houses being built around Bukit Indah and Nusajaya expansion which gives a lot of
rooms for people and entrepreneurs to expands and venture. Penang, a small island in
Malaysia has grown tremendously in such a short term after recent initiatives by the state
government to encourage the growth of local entrepreneurship and SMEs are beginning to
show results (Penang Monthly, 2012). Penang adopted few approaches for small medium
3
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
businesses to be implemented over the next few years such as Smart Centre which was
launched in June 2010. Smart Centre as a fresh start up was in fact facilitating SMEs by
including provisions of information and information, business matching, building workshops
and offering free listing in its online directory. The other approaches are for instance Penang
SME Centre which helps incubate SMEs through subsidized rentals to tap into
investPenang‘s industry network of venture capitalists, research institutions, potential market
opportunities and intelligence. SMEs Villages are currently being developed by Penang
Development Corporation to provide a more conducive operational environment. By
witnessing local enterprises as drivers of Penang‘s economy, other states can do the same to
improve and share knowledge by utilizing the resources meritoriously to bring Malaysia to
another step in the global economy.
SMEs are considered to be a key driver of economic growth for many developing countries
and comprise over 90% of all businesses globally (Ariyo 2000; Krake, 2005; Tang et al, 2007
Maurel, 2009). Growth has been used as a modest measure of success and performance in
business and as Delmar et al. (2003) also insinuate that it is an appropriate indicator for
surviving small medium businesses. Many evidences portrays that through encouragement
and promotion of entrepreneurship, countries such China and Singapore have achieved
economic transformation to a giant productivity market. SMEs contributes to economic growth
(van Stel, Carree & Thurik, 2005), innovation (Baumol, 2005; Wong, Ho, & Autio, 2005; Acs
& Armington, 2006; Schramm, 2006; Audretsch, 2007), enhanced productivity due to
increased competition (Nickell, Nicolitsas and Dryden, 1997), and leveraging of knowledge
spillover effects (Audretsch and Keilbach, 2004) especially to emerging markets such as
brazil and Mexico (Rangamohan V. Eunni, 2010) Moving forward, SME‘s great potential as
the engine of the economic growth could be seen as well both in the East and in the West like
Germany and Japan (Samad, 2007). Bradley and O‘Reagain (2001) who commented that
small businesses could some sort internationalize to seek rapid growth. The fact that
Malaysia Government has paid so much attention to the SME demonstrates its importance as
well. This can be justified in which government has reserved financial assistance stated in
Budget 2012 to help boost the progression of SMEs activities.
SMEs have massive rooms of growth due to the rapid adoption of the Internet. The physical
boundaries and distance become less important as firms all over the world are now able to
cater for larger markets more efficiently (Kim et al., 2004) helping SMEs to grow
internationally in terms of input or output. All this development has coerced firms to step up the
level of competitiveness against their competitors in the same industry. Only the firms that
have the capability in all facets of competitive priorities (Singh et al., 2007) will survive in such
a turbulent marketplace. Confronting with more rapid changes in the market than ever before,
firms have no choice, but to adapt to the environment in order to survive and prosper (Gereffi,
2001). Numerous researcher has unanimous pointer with regards to technology and
information support SMEs are to a greater extent competitive in addition to revenue making
organizations, ultimately constructing a major role to the national economic growth (Agarwal
R. et al, 2005; Pfeiffer J, 2007;Nowduri 2012).
The small and medium-sized enterprises (SMEs) are also recognized as being one of the
principal driving forces in economic development. SMEs in Malaysia stimulate private
ownership and entrepreneurial skills. Besides, those SMEs are also flexible and can adapt
quickly to changing market demand and supply situations. In due process, those SMEs
4
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
generate employment, help diversify economic activity and make a significant contribution to
exports and trade (Ahmad, 2011).
The Malaysian economy performed better than expected this year mainly due to the large
multibillion ringgit infrastructure as well as other projects which were rolled out under the
Economic Transformation Programme (ETP). ETP was initiated by Dato Seri Najib Razak in
2010 to propel Malaysia to advanced nation status, with an emphasis on inclusiveness and
sustainability. This transformation programme benefits small medium businesses especially
in healthcare, education, oil and gas, and distributive trade. The insights of this programme
will enhance the development of SMEs in many ways. More training grounds, techniques and
funds will flow throughout to facilitate the goals by making Malaysia‘s business environment
more prudent and sensible. The big risks like the weak European banks and the China
property market will diminish while interest rates continue to remain low in the West. Hence
this will encourage capital flows to Malaysia. Among the capital markets, the excitement in
Thailand, the Philippines and Singapore, as compared to Indonesia and Malaysia. The
rationale behind this is mainly because Malaysia tends to be more defensive while Indonesia
has to manage its current account deficit. However, Malaysia is among one of the most stable
country in Asia which favours many of the investors. This provides rooms for the SMEs
especially trade and also manufacturing companies to expand their horizon globally beyond
their comfort zone at local.
Branding Strategy among Small Medium Enterprises
Over and over again in the last decades, we have heard the word ―branding‖ and how it helps
a company to build status and name in the eyes of consumer. Branding is indeed a
manipulating factor of every tangible and intangible thing on earth. Even people need to be
branded in order to climb the ladder in a corporate world by building networks, connections
and getting noticed by the society. Same goes to a tangible product, brand is a way of
differentiating products or services from others and making the products attractive to
customers and because of its ethereal characteristics, different people find different ways to
make sense of it (de Chernatony, 1999). Companies may achieve competitive advantage
through acts of innovation and innovation can be in the form of new product design, new
production process or new marketing approach (Foon, 2006; Zulkifli Muhammad et al 2010).
According to Krake (2005) and Muyimba (2009), branding is a comparatively fresh topic
among small medium businesses. Even though brand management is properly debated in
research and publications of journals among multinational companies, SMEs are discarded
as an isolated unit. Big and small organizations have crystal clear differences in marketing
methods (Abimbola & Vallaster, 2007). Moreover, former researchers has disclosed that the
utmost frequently stated difficulties by management of SMEs are marketing complications
typically involving inadequate funds, aptitude, and expertise. In publicizing SMEs intensely
emphasis on goods and price, use of flyers and are mainly focused on sales neglecting the
importance of branding and of not a significance matter (Krake, 2005; Bunnett & Smith, 2002;
Hill & Wright, 2001). The proprietor of the small business plays a vital part in structuring and
handling a brand management (Boyle, 2003), explicitly the eccentric of the entrepreneur or in
particular in modern day‘s term called leadership branding. They should first consider
themselves as the major source of branding. In other words, they are part of their brands.
(Fauziah et al, 2012)
5
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
Realizing the importance of branding, all companies including SMEs need to strengthen the
branding to better position themselves and actively distribute its products if a recognized
brand is established. (Zulkifli Muhammad et al, 2010) The brand personifies the perceived
value of the propositions contrasted with the rivals of the same industries. It is the image that a
company wants to depict to the customers, stakeholders, employees and to the public across
the world, the personality and soul of a company by which employees are hired to how
customers perceive the organization, company‘s viewpoint to reason, view, interrelate and
serve consumer. It considered customers‘ experience with the company as the primary
predecessor to the conception of brand meaning (Berry 2000).
A very collective word used in the corporate society today is strategy. Nevertheless, it is one
of the most badly used or misused expression in terms of its definition. It often creates
confusion and misperceptions as a consequence of failure by businesses to appropriately
use and understand the meaning. Strategy refers to means, approaches, and plans and not
ends. Strategy is a never ending story to a company. Different companies can apply different
strategies in order to climb the highest profit. Every company walks towards one objective
which is to be successful. Basically, it debates about in what way businesses can attain its
indicated goals. Strategic gears are the many components that lead the path or direction in
order to achieve its objectives. Any operational strategic tool allows a company to
concentrate its uncommon or inadequate resource on the utmost prospect so that sales
increase and reach a sustainable competitive advantage. Multinational companies are good
at objective settings and implementing various strategies to achieve its objective of becoming
more well-known by advertising and forms of persuasive marketing than non-international.
(Stopford & Wells 1972 ; P.P Ekerete 2001)
There are three types of qualities where companies can implement to improve on how the
SMEs should market and target. Interestingly, the spectrum of products and services was
developed back in the 1996 to manage a company depending on the things it sells shown in
Figure 1. The differentiations consist of high search in qualities, high in experience qualities
and high in credence qualities. High in search qualities includes the attributes customers can
categorize and access before making a decision.
6
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
Figure 1: The evaluation spectrum of products and services
(after Zeichaml and Bitner 1996)
High in search
qualities
High in experience
qualities
High in credence
qualities
Tangible goods are naturally high in search qualities hence to manage this common strategy
involves boosting customers to endorse the brand to other customers via promotions.
Moreover, Word-of-mouth acts as a reliable basis of information. Second category will be
high in experience qualities. This kind involves both products and services at the same time
where the segregating characteristics can be evaluated while being used for instance, dining
in an exclusive restaurant. Demonstrations of the service will assist people to create
judgments whether a good one or a bad ones. Third category will be high in credence
qualities. Consumer has inadequate awareness to understand and evaluate the services,
even after being consumed such as a lot people would find it hard to entirely measure the
superiority of major surgery or in fact is tough to evaluate a doctor‘s quality after consultation.
Businesses should match their products and services to the three types of qualities
accordingly and implement appropriate strategy to capture and operate on their strength and
weaknesses. Perhaps is a simple yet helpful to coordinate brand management. By what
means brand can stimulate customers‘ evaluation of the search, experience and credence
qualities of an offering, and in what way this is moderated by product test is effectively
demonstrated by Srinivasan and Till (2002).
Hence, branding is often an essentially new concept for people in small and medium sized
enterprises (Inskip, 2004). The notion of a brand can be traced back to product marketing
where the role of branding and brand management has been mainly to construct
differentiation and preference for a product or service in the mind of the consumer (Knox &
Bickerton, 2003). Branding is more than just giving a name to the product, it encompasses
the entire idea of putting emotional appeals, embodies a whole set of physical and social
psychological attributes and beliefs as well. Developments after developments being made to
7
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
product branding and it is characterized by layers of added value built around the core
functionality of the product or service to create and maintain distinction in a particular market.
Branding Dimensions Model
Dimensions of how entrepreneurs‘ success in branding is yet to be fully explored. The
strategic significance of brand management has long been acknowledged in the literature
reviews (Keller, 1998; Park, Jaworski, & MacInnis, 1986). Two research streams have
developed: one concentrates on leading a principal brand management framework to guide
managerial decision making (Aaker, 1991; Keller, 1998; Park et al., 1986), whereas the other
focuses on several distinct features of the development (Aaker & Joachimsthaler, 2000).
Small medium businesses are growing tremendously in the international context yet have so
far received only scant attention. The strategic significance of branding its product is generally
still vague concerning specific marketing recommendations especially in Malaysia despite
the growing community of entrepreneurs here. The extensive literature search of online journal
articles revealed only decades of articles so far. It was found that the phenomenon was almost
non-existent before 2005. This might be because traditionally branding is considered as a
large company‘s issue, and it was not until recently that branding was considered as a SME
issue as well.
A more central focus on the market position and brand identity is what we called brand
adaptation which subsumes marketing mix approach. Global markets are becoming
heterogeneous. Diversification of customers from different countries may want dissimilar
brands. Culture is especially the moderating factor of branding strategy. It can have an impact
on firms‘ marketing strategies. For example, firms change their brand names in foreign
markets to avoid linguistic problem (Francis et al., 2002). Cultural understanding of the brand
meaning of McDonald (Eckhardt & Houston, 2002), have indicated the importance of culture
affecting global branding accomplishments. Another aspect which needed to take in control is
the income level to help branding. Every business has to consider who their target markets
are. Marketers require not only people but also people with money. Hence, it is essential to
know the income facet to position a precise marketing strategy. Income conditions can
influence branding strategy in several ways. The demand potential for certain product is
based on the monetary circumstances and a company‘s cost structure is also depending on
the income conditions (Theodosiou & Katsikeas, 2001). Organizations that are able to
successfully transform and adapt their goods and branding to local tastes depend profoundly
on their census. It is the only alternative to avoid inflated errors that could destruct the
opportunities for success in the future.
Branding as seen in Figure 2 was affected by cultural causes. It is also understood by the
meaning as some sort of man-made manner of reacting to familiarity and a behavioral form.
Culture influences intentions, brand knowledge, approaches and intention to use. Hence, it is
not only a contracted view of person actions, but encompasses to comprise the entire actions
which describe the behavior of certain groups of individuals—the manner they consume,
speak, their expressions and overall behavioral pattern. Most of the companies which are
customer oriented are likely to focus on cultural aspect. Many of the multinational companies
are in this category. One the reasons why these companies made it to global is due to the
branding strategy they implied to ease customer‘s needs. Without applying cultural factor, they
may not have done it. It is an undeniable fact because customers have certain preferences
8
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
regardless of their phases in life. In recent times, marketers have intensified cultural effects on
their marketing doings. Culture reflects an incredible range of diversification. They are
intended to fulfill living in addition to appreciation and companionship requirements.
Meanwhile there are dissimilarities in necessities and marketing opportunities, it is true that
an individual‘s culture is significant to both marketing academics and consultants similarly.
Culture has to be understood by small medium businesses since it delivers accepted specific
end objectives for whichever comprehensive human need.
Figure 2: Conceptual Framework of Branding
Income
Branding
Culture
Income is another important factor for a company before implementing or adapting to any
strategy. The last thing a firm wishes to be at is where it faces lack of money resources. Both
incomes have to be considered whether in terms of cost of the company or the targeted
people‘s income level. Marketing and brand managers have the control to improve marketing
strategies to position the brand and to upsurge brand equity. Alternatively, customers need to
have sufficient disposable wages to purchase the brand, irrespective of the strategy.
Furthermore, these customers have variances in their capability (income) to acquire a product
that affect their brand judgments, and the brand significance.
9
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
Figure 3: Seven Dimensions of Branding
Branding
Dimensions
Brand
Benefits
Brand
Relevancy
Brand
Consistency
Branding
Brand Portfolio
and Hierarchy
Brand
Equity
Brand
Meaning
Brand
Support and
Sustainability
Over the years, marketing researchers and consultants have continued to develop the field of
brand management and designate the relevant applications, values and ideas that
companies should practice. The emphasis has tended to be on the world‘s most notable
brands. Leaders of big organizations, with substantial marketing resources, thus have a great
quantity of intelligent information to monitor their labeling efforts. Nonetheless, the question of
how smaller organizations, with uncertain resources, can effectually succeed their brands has
yet been completely gone unnoticed by researchers. A study conducted by Napoli 2005,
branding matters to all SMEs and few selected brand dimensions which differentiate high
performing and lower performing companies. More emphasis was placed on brand benefits,
brand relevancy, brand consistency, brand portfolio and hierarchy make sense, marketing
activities to build brand equity, brand‘s meaning to customers and proper support to branding
and its sustainability in the long run as reflected in Figure 3. These dimensions place a major
identity to the eventual success of the performance of marketing strategy. Napoli stated that
these findings provide some empirical evidence of the importance and value of brand
management to SMEs.
In order to mature the competences within a company to create effective strategic marketing
strategies, an organization requires the capacity to realize the altering dimensions of the
10
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
branding in the market it drives and the influence this has on its competitive advantage. The
strategies comes dimensions of branding must be able to challenge customary thinking and
cultivate an advanced culture through learning and information management for sustainable
advantage in the market. Yet again, small medium business or any organizations should have
the capability to review strategic marketing verdicts and measure strategic decisions with
regard to the prospective yield on any investments made.
Figure 4: Branding Dimension Model in Affecting Performance of Marketing Strategy of Small
Medium Enterprises
Branding
Dimensions
Income
Brand
Benefits
Brand
Relevancy
Brand
Consistency
Branding
Brand Portfolio
and Hierarchy
Performance of
Marketing
Strategy
Brand
Equity
Culture
Brand
Meaning
Brand
Support and
Sustainability
Figure 4 shows the entire model of branding dimension model in affecting marketing
performance of SME. Marketing performance determines the success of a company. Small
medium businesses which focused on brand are competent to attain a distinct performance
gain over competitors by for all intents and purposes getting back to the ‗branding basics‘:
which is, understanding consumers‘ wants and brand awareness, constructing significant and
valued brands, supporting the brand constantly over time, efficiently connecting the brand‘s
distinctiveness to inside and outside of a company and building a clear brand architecture.
According to Keller (1999) and Park et al (1986) such actions are well illustrated in the
literature as essential for building and managing brand equity in the long run.
11
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
Conclusions
The basis of businesses accomplishment nowadays are solely on concrete trademark
approaches, with visibly distinct brand ideas, standards, positioning and strategies for
execution. People have to bring up more solid brand strategies, and the progress of a brand
philosophy is important if corporations are to bring out the messages proposed by market
communications. It is not done by how clever or creative a person can be but with careful,
diligent planning and execution, a brand can be brought out to the world for people to see and
to feel. This paper reveals that it is not only large companies implement branding plans but
SMEs does too and in fact there are so much growing potential lies beneath these small
medium businesses. Marketing of SMEs may differ from marketing of multinational
companies similarly branding issues of SMEs may also vary from branding issues of large
companies. However, the truth is that there is so much to learn for SMEs in branding terms,
dimensions of strategies and how to make precise decisions in product branding. Branding is
a never ending story especially to sophisticated customers nowadays. It depends on how to
think out of the box to catch customer‘s attention then to retain it.
Branding is an imperative determinant to affect marketing strategy of a company. It is not only
a consideration that large companies should take but also small medium businesses
because SME could profit from these advantages as well. In fact branding implementations
ought to be further wisely taken care of by small business companies.
SMEs marketing strategy may differ from large companies. SMEs has yet to adapt branding
and is an essentially new concept for people in this industry, hence there is a lot to learn for
SMEs in branding matters. SME perspective may be an interesting and practically a static
untouched area which may offer important insights for effective branding concept
development. Also until today, branding in SMES has been an infrequently studied
phenomenon, but gradually its importance is understood, and it is reflected as a fresh,
fascinating study field.
References
Aaker, D. A. 1991, Managing brand equity. Capitalizing on the value of a brand name.
New York: The Free Press.
Aaker, David A. And Erich Joachimsthaler 2000, Brand Leadership, London, Free Press
Abimbola, T. and Vallaster, C. 2007, ―Brand, organizational identity and reputation in SMEs:
an overview‖ Qualitative Market Research: An International Journal Vol. 10, No.4, pp
341-348. Emerald Group Publishing Limited
Acs, Z.J. and Armington, C. 2006, Entrepreneurship, Geography and American Economic
Growth, Cambridge: Cambridge University Press
Ahmad, F. S., & Baharun, R. (n.d.) 2010, A crucial role of Entrepreneur in B2B branding: A
case from Malaysia. Faculty of Management and Human Resource Development,
Universiti Teknologi Malaysia.
Ahmad Zahiruddin Yahya, Mohd Said Othman, Abdullah Sanusi Othman, Ishak Abdul Rahman
and Jumaat Abd Moen 2011, Process Innovation: A study of Malaysian Small Medium
Enterprises (SMEs) World Journal of Management Vol. 3. No. 1. March Pp.146- 156
12
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
André Stel & Martin Carree & Roy Thurik, 2005. "The Effect of Entrepreneurial Activity on
National Economic Growth," Small Business Economics, Springer, vol. 24(3), pages
311-321, 02
Ariyo .D. 2000. Small films are the backbone of the Nigerian economy. African Economic
Analysis. Available at http: /www.afbis.com/ analysis/small.
Audretsch, D.B. 2007. Entrepreneurship capital and economic growth. Oxford Review of
Economic Policy, 23(1): 63-78.
Baumol, W.J. 2005. The free market innovation machine: Analyzing the growth miracle of
capitalism, Princeton: Princeton University Press
Berry, L. L. 2000. Cultivating service brand equity, Journal of the Academy of Marketing
Science, 28(1), 128-137 Books, New York
Boyle, E. 2003, ―A study of entrepreneurial brand building in the manufacturing sector in the
UK‖, Journal of Product and Brand Management, Vol.12, No. 2, pp. 79-93.
Bradley, F., & O'Reagain, S. 2001. Deriving international competitive advantage in SMEs
through product-market and business system resource allocation. Irish Journal of
Management, 22 (2), 19-44.
Bunnet, R. J., and Smith, C., 2002, ―competitive conditions, competitive advantages and
location of the value chain.‖ Journal of Product and Brand Management, Vol. 12, No. 4,
pp 220-236
Carole Maurel, 2009 "Determinants of export performance in French wine SMEs",
International Journal of Wine Business Research, Vol. 21 Iss: 2, pp.118 – 142
Curran, J. and Blackburn, R.A. 2001, Researching the Small Enterprise.SAGE Production:
London
David B. Audretsch & Max Keilbach, 2004. "Entrepreneurship Capital: Determinants and
Impact," Papers on Entrepreneurship, Growth and Public Policy 2004-37, Max Planck
Institute of Economics, Entrepreneurship, Growth and Public Policy Group.
Delmar., F. Davidsson, P. and Gartner, W. 2003, ‗Arriving at the High-Growth Firm‘, Journal
of Business Venturing, 18, 2, 189-216.
de Chernatony, L. 1999. Brand management through narrowing the gap between brand
identity and brand reputation. Journal of Marketing Management, 15(1-3), 157-179.
Dr. M. Mohd Rosli Competitive Strategy of Malaysian Small and Medium Enterprises: An
Exploratory Investigation, American International Journal of Contemporary Research
Vol. 2 No. 1; January 2012
Eckhardt, G. M., and M. J. Houston. 2002. Cultural paradoxes reflected in
brand meaning: McDonalds in Shanghai, China. Journal of International
Marketing 10 (2): 68-82.
Emmanuel O. Oni, Isah Imam Paiko Koholga Ormin 2012, Assessment of the Contribution of
Micro Finance Institutions (MFIs) to Sustainable Growth of Small and Medium Scale
Enterprises (SMEs) in Nigeria Interdisciplinary Journal Of Contemporary Research In
Business, Vol 3, No 9
Eunni. R.V. 2010. ―Institutional Environments for Entrepreneurship in Emerging Economies:
Brazil vs. Mexico‖. World Journal of Management, 2(1): 1-18
Eyre, P. and Smallman, C. 1998, Euromanagement Competences in Small and
MediumSized Enterprises: A Development Path for New Millennium?, Management
Decision, 36(1), 34-42.
13
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
Fauziah Sh. Ahmad, Rosmini Omar, Siti Zaleha Abdul Rasid, Muslim Amin 2012, Leadership
Branding for Sustainable Customer Engagement, International Journal of Social and
Human Sciences 6 , 217-224
FMM Directory. 2005, FMM Directory: Malaysian Industries. Federation of Malaysian
Manufacturers (FMM) (36th Edn.). Kuala Lumpur Malaysia
Foon, L. S. & Eu-Gene, S. 2006, The changing of education in the globalized world.
Proceedings of Persidangan Kebangsaan IKS 2006, Kuala Lumpur: Universiti Utara
Malaysia.
Francis, J. N. P., Lam, J. P. Y., & Walls, J. 2002, Executive insights: The impact of
linguistic differences on international brand name standardization: A
comparison of English and Chinese Brand name of Fourtune-500 Companies.
Journal of International Marketing, 10(1), 98-116.
Gibb, A.A. 1993, Enterprise Culture and Education: Understanding Enterprise Education
and its Links with Small Business Entrepreneurship and Wider Educational Goals,
International Small Business Journal, 11(3 April -June), 11-34
Hashim, M.K. and Wafa, S.A. 2002, Small and Medium-sized Entreprises in Malaysia:
Development issues. Prentice Hall, Pearson Malaysia Sdn Bhd: Kuala Lumpur.
Hill, J. and Wright, L . T. 2001, ―A qualitative research agenda for small to medium-sized
enterprises.‖ Journal of Marketing Intelligence & Planning, Vol. 19, No. 6 pp. 432-443. MCB
University Press.
Inskip, I. 2004. Corporate branding for small to medium-sized businesses - A missed
opportunity or an indulgence? Journal of Brand Management. Vol. 11. No. 5, 358–365.
Keller, K. L. 1993. Conceptualizing, measuring, and managing customer-based brand
equity. Journal of Marketing, 57(1), 1–22
Keller, K. L. 1999. Managing Brands for the Long Run: Brand Reinforcement Revitalization
Strategies. California Management Review, 41(3), 102-124.
Knox, Simon And David Bickerton (2003), ―The Six Conventions of Corporate Branding‖,
European Journal of Marketing, 37 (7/8), 998-1016
Krake. F.B.G.J.M 2005, Successful Brand Management in SMEs: a new theory and practical
hints. Journal of Product & Brand Management. Vol. 14, No. 4, pp 228-238. Emerald
Group Publishing Limited.
Mori, J. 2005 Malaysia‘s Challenges to Industrial Linkage: Policy Coordination at Local and
National Level, the Fletcher School, Tufts University
Muyimba, N.K.A. 2009, ―Brand orientation, brand distinctiveness and SME performance in
Uganda.‖ Conference proceedings of the Second Annual international conference on
entrepreneurship (SAICE), Wits Business School, South Africa, October 2009.
Nickell, S. & Nicolitsas, D., 1997. "Human Capital, Investment and Innovation: What Are the
Connections?," Papers 20, Centre for Economic Performance & Institute of
Economics.
P.P. Ekerete 2001, The Effect Of Culture On Marketing Strategies Of Multinational Firms: A
Survey Of Selected Multinational Corporations In Nigeria, African Study Monographs,
22(2): 93-101,
Park, C. W., Jaworski, B. J., & MacInnis, D., J. 1986. Strategic Brand Concept-Image
Management. Journal of Marketing, 50(4), 135-145
Penang Montly 2012, November Issue Letting SMEs grow Penang
14
Proceedings of 3rd Asia-Pacific Business Research Conference
25 - 26 February 2013, Kuala Lumpur, Malaysia, ISBN: 978-1-922069-19-1
Rangamohan V. Eunni 2010 Institutional Environments For Entrepreneurship In Emerging
Economies: Brazil Vs. Mexico World Journal of Management Vol.2 No.1 March, Pp. 118
Samad, N. A. 2007. Positioning Malaysian SMEs in the global. Proceedings of Persidangan
Kebangsaan IKS 2007,Kota Kinabalu: Universiti Utara Malaysia.
Saqib Omer Saeed 2005, Role of SMEs in Pakistan, Inter University Article Contest in 2005.
The article is published in Pakistan & Gulf Economist Sep 19 – 25.
Saraniemi S., Ahonen M. 2008, Destination branding from corporate branding perspective.
Paper accepted for presentation in the Conference on Corporate Communication
2008, June 6th-9th, Wroxton, England.
Schramm, C.J. 2006, The Entrepreneurial Imperative, NY: Harper Collins
Srinivas Nowduri 2012 Framework for Sustainability Entrepreneurship for Small and Medium
Enterprises (SMEs) in an Emerging Economy, World Journal of Management Vol. 4.
No. 1. March Pp. 51 – 66
Stopford, J.M. & L.T. Wells, Jr. 1972, Managing the Multinational Enterprises: Organization of
the firm an ownership of the Subsidiaries, New York, Basic Books
Tang, Y. Wang. P. and Zhang, Y. 2007, ―Marketing and business performance of construction
SMEs in China‖, Journal of Business and Industrial Marketing, Vol, 22, No.2, pp.118125
The NST. 2006 The New Straits Times: 10. Kuala Lumpur, Malaysia
Theodosiou, M., & Katsikeas, C. S. 2001, Factors influencing the degree of international
pricing strategy standardization of multinational corporations. Journal of International
Marketing, 9(3), 1-18
Wind, Y. 1986,The myth of globalization. Journal of Consumer Marketing, 3(2),
23-26.
Wong, P.K., Ho, Y.P. and Autio, E. 2005. Entrepreneurship, innovation and economic growth:
Evidence from GEM data, Small Business Economics, 24: 335-350
Zizah Che Senik, Rosmah Mat Isa, Brenda Scott-Ladd, and Lanny Entrekin, Influential Factors
for SME Internationalization: Evidence from Malaysia Int. Journal of Economics and
Management 4(2): 285 – 304 (2010)
Zizah, C.S., Entrekin, L. and Scott-Ladd, B. 2006, Exploring the Internationalization Process
of Small to Medium-sized Entreprises (SMEs) in Malaysia: A Preliminary Finding.
Proceeding of the Academy for Global Business Advancement Third World Congress
(AGBA), Kuala Lumpur January 4-6, 2006, Malaysia
Zou, S., & Cavusgil, S. T. 1996. Global strategy: A review and an integrated conceptual
framework. European Journal of Marketing, 30(1), 52-69.
Zulklifi Muhammad, Abd Kamar Char, Mohd Rushdan Yasoa, Zakiah Hassan 2010, Small
and Medium Enterprises (SMEs) Competing in the Global Business Environment: A
Case of Malaysia, International Business Research Vol 3, No 1
15
Download