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Original Article

The five phases of SME

Received (in revised form): 6th August 2012

Edgar Centeno
is Lecturer of Marketing at Monterrey Institute of Technology (ITESM) Mexico. He received his PhD degree from the
University of Strathclyde and holds an MBA and BSc degrees from Clarion University, Pennsylvania. Before starting his
academic career, he worked for over 15 years in large multinational companies and SMEs. He is currently the regional
editor for Latin America and the Caribbean for the Journal Place Branding and Public Diplomacy. He has been Guest Editor
for special issue on interlink of Marketing & SMEs of the Marketing Intelligence & Planning.

Susan Hart
is Dean of Strathclyde Business School. She has worked for a variety of private sector companies, ranging from
multinationals to small manufacturers in consumer and industrial enterprises. Publications have appeared in several
international journals. She holds several distinguished positions. She is a member of the Executive Committee of the
Academy of Marketing and the Senate of the Chartered Institute of Marketing, as well as a Fellow of the Marketing

Keith Dinnie
is Senior Lecturer in International Marketing at NHTV Breda University of Applied Sciences and Director, Centre of City
Branding. He is editor of the acclaimed book City Branding Theory and Cases (Palgrave Macmillan, 2010) and author
of the worlds first academic textbook on nation branding, Nation Branding Concepts, Issues, Practice (Butterworth
Heinemann, 2008). From 2009 to 2011 he served as Academic Editor of the leading international journal Place Branding
and Public Diplomacy. He has been Guest Editor for special issues of the Journal of Brand Management and International
Marketing Review. He is the founder of Brand Horizons consultancy.

ABSTRACT The purpose of this article is to examine how brands are built in small-tomedium-sized enterprises (SMEs) and to develop a conceptual model of SME brandbuilding. The research design is based on an a priori conceptual framework that helped
direct the fieldwork, data analysis and findings. A series of semi-structured interviews
was conducted among 35 owner/managers from 30 firms. The results indicate that
SME brands are built in a non-traditional manner and contrary to large firm brand
building, with minimum brand planning and limited resources. SME brand-owner/
managers and employees engage in brand exploration phases where they experiment
in a spirit of trial and error based on risk-taking, commitment, creativity and willingness
to learn. Based on these results, the article develops a model of the five phases of
SME brand-building. The five-phase model represents an actionable framework for
managers in an SME context. The model also presents scholars with a theoretical
foundation upon which to construct further theory development.
Edgar Centeno
School of Business, Monterrey
Institute of Technology Mexico
(ITESM), Calle del Puente 222,
Col. Ejidos de Huipulco,
Tlalpan DF 14380, Mexico

Journal of Brand Management (2013) 20, 445457. doi:10.1057/bm.2012.49;

published online 14 September 2012
Keywords: small-to-medium-sized enterprises (SMEs); brand-building; brand identity;
brand differentiation

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Centeno et al

The aim of this article is to explore how
brands are built in small-to-medium-sized
enterprises (SMEs). Although brands have
been studied extensively, much of the literature has relied heavily on large company
brands rather than SMEs (Aaker, 1996; de
Chernatony and McDonald, 2003; Keller,
2003; Kapferer, 2004; Krake, 2005). The
type of organisation is one of the key drivers
of brand-building and may influence a particular approach on the basis of the organisations characteristics and context. For
instance, large organisation brands are often
built on resource efficiency, formal structures, expertise, performance evaluation
and measurement and long-term planning
(Aaker and Biel, 1993; Coviello et al, 2000;
Kapferer, 2002). However, SME brands are
often built in a very different context, as
SMEs are usually characterised by flat and
informal organisational structures, innovation, creativity, ad hoc planning and lack of
financial resources and experience (Carson,
1990; McGaughey, 1998; Gilmore et al,
2001). Despite these key differences, it has
been assumed that SME brands may develop
in a similar way to large company brands
and that what may work for larger organisation brands may also work for SME
brands. This has left unquestioned the relevance of brand theories within the context
of SMEs (Abimbola and Kocak, 2007). This
article seeks to contribute to theory development that helps to understand brandbuilding in SMEs through a proposed model
of a five phases of SME brand-building.
SMEs are important contributors to
national economies across different countries
(Lindell and Karagozoglu, 1997; Inskip,
2004). They have also been recognised as a
source of growth, employment and competitiveness (McGaughey, 1998; Acs et al,
1999; Culkin and Smith, 2000; Robbins
et al, 2000; Arinaitwe, 2006; de Noronha
Vaz et al, 2006). Furthermore, it has been
argued that larger companies are no longer


capable of generating sustainable economic

growth and that SMEs are key players for
economic recovery (Ribeiro, 2005). Yet,
SME brand theories have remained underdeveloped. This new area of research may
bring into light not only a new paradigm for
brands, but may also help understand further
the complexity and multidimensionality of
brands while contributing to the healthy
expansion of SMEs and in due course
national economies. SME brand-building
thus resonates for both scholarly and practitioner audiences.
This article is structured as follows. First,
a brief discussion of the key themes of
brand management is presented in relation
to the focus of this study: brand identity,
brand differentiation, SME marketing and
SME brands. Then, we present our a priori
conceptual framework and describe how
our data were analysed. Next, we discuss
our results including our proposed five
stages model of SME brand-building, and
implications for SME brand managers.
Finally, limitations and recommendations
for future research are suggested.


Brand identity and brand
For this study, an a priori conceptual framework was developed based on two key
brand elements: brand identity and brand
differentiation. Both were identified as the
main constructs for understanding brand
development in this study. The selection of
these constructs is based on suggestions in
the literature that both brand elements may
be key building blocks for brand growth
(Keller, 1993; Burmann et al, 2009). Firstly,
brand identity has been conceptualised as a
brand element that the brand manager
aspires to create and develop composed of
four main dimensions: brand as a person,
brand as an organisation, brand as a symbol
and brand as a product (de Chernatony,

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Five phases of SME brand-building

2006; Aaker, 1996). Such a model represents a promising theory to understand

SME brand growth as it includes clear-cut
and easily understood constructs. Such model
characteristics have been recommended
when gathering data from owners of SMEs
(Carson and Cromie, 1990). Secondly,
brand differentiation has also been argued
to be a key factor for brand growth.
According to Young & Rubicams Brand
Asset Valuator Model, brand differentiation
may not only give birth to the brand, but
may also be critical to sustain growth (Agres
and Dubitsky, 1996). Without differentiation, serious threats are posed to brand
growth and may lead to brand decline (de
Chernatony and DallOlmo-Riley, 1998).
For our study, the a priori conceptual framework identifies any of the four brand identity dimensions as main sources of brand

SME marketing
The number of studies of SME brands is
relatively small; however, there has been
a greater amount of research conducted
into the wider domain of SMEs and marketing. A review of salient literature on this
topic provides insight into the context and
nature of SME brands. It has been argued,
for example, that SMEs have a different
approach to marketing and that traditional
marketing theories are inappropriate for
describing how SMEs practice marketing
(Carson and Cromie, 1990; Hogarth-Scott
et al, 1996; Gilmore et al, 2001). For
instance, Centeno and Hart (2011) examine
brand communication activites in SMEs.
Their study suggests that due to their context and specific characteristics, communication activities which help them to have
a more personalised communication are
more frequent than any other communication activity.
Furthermore, it has been suggested that
traditional marketing may constrain SMEs
activity and impact in the market (Carson

and Cromie, 1990) and that SME marketing may need to consider the unique
characteristics of SMEs, including informal
structures and processes, flexibility and
innovations (Brown, 1985). Moreover, the
marketing activity of SMEs usually takes a
short-term rather than a long-term approach.
Such a perspective is partially due to the
high levels of uncertainty and complexity
confronted by many SMEs, derived from
the diversity of market conditions and the
sophistication of knowledge (Bhide, 1994;
Van Gelderen et al, 2000). It has also been
proposed that during the development
stages of a small organisation, it may
encounter transitional periods of crisis or
instability those problems that disrupt the
organisation due to internal or external
changes which are usually unforeseen and
beyond managements control (Scott and
Bruce, 1987). At the same time, these
periods pose great challenges and risks to
the business as it may require learning and
operationalising new sets of abilities and
activities if it is to continue to survive
(Mount et al, 1993). Such issues pose large
challenges for a long-term marketing perspective in SMEs.

SME brands
Relatively few studies focus specifically on
SME brand research. In particular, the topic
of SME brand-building appears to have
been largely ignored in research to date.
Implicitly, it has been assumed that small
and large organisation brands grow similarly
even when their context and resources are
very different. This new area of brand study
is at a pioneering stage and is yet to show
its full potential and make a significant
influence and contribution to branding and
to the marketing discipline (Boyle, 2003;
Krake, 2005; Merrilees, 2007). Some studies
have attempted to understand the role of
SME branding as a competitive strategy
(Abimbola, 2001; Merrilees, 2007). Such
findings suggest that not all SMEs are

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Centeno et al

brand-oriented but may evolve through a

brand orientation process based on four
distinct constructs: brand barriers, brand
orientation, brand strategy and brand distinctiveness; furthermore, as a brand improves
its performance in the marketplace, the SME
is more confident to continue its evolution
comprised of three stages: minimalist, embryonic and integrated brand archetypes
(Wong and Merrilees, 2005). Other studies
have suggested that brand management
activities are not on the top priority list
of SME owners (Krake, 2005). However,
many problems faced by SMEs are brandrelated, including a lack of resources. Additionally, the owner/manager may play a
strong role in brand management (Lory and
McCalman, 2002; Rode and Vallaster,
We have proposed that SME brand management is considerably different when
compared with brand management in larger
organisations. Some brand models and relationships may occur differently with SME
brands (Baldinger et al, 2002). For instance,
in Berthon et al (2008) study on SME
brands, it was found that from the 10 brand
management dimensions recommended in
Kellers report card1 (2000) for brand
strength, nine of them registered significant
differences. It was also reported that the 10
brand management dimensions are more
suitable in setting apart high and low performing small and large organisations than
measuring up SME brand strength. Their
findings suggested that the brand report
card did not reflect the subtle differences
of managing SME brands. In terms of corporate brand processes, Inskip (2004) found
some key issues relevant to SME brand
process that were not considered to contribute to an understanding of corporate
SME brands. Other studies have sought to
understand specific brand elements in an
online context. For instance, domain name
availability poses future implications for
brand name creation (Kollmann and


Suckow, 2007). Moreover, in terms of

brand personality, findings suggest that SME
brand personality may be communicated
through an adequate marketing communications programme through the Internet
(Opoku et al, 2007).
The research design is based on an a priori
conceptual framework, which is a useful
technique to direct the fieldwork, data
analysis and findings (Miles and Huberman,
1994). This framework is derived from our
review of the literature and is based on the
following propositions. First, brand identity
and brand differentiation influence SME
brand growth. Second, the owner/manager
influences a particular brand budget to
be used for different brand activities such
as sales, brand communications and new
product development. Figure 1 displays the
a priori conceptual framework.
While our a priori conceptual framework
helped guide the analysis, findings showed
a richer and more complex phenomenon.
So, Figure 2 displays our proposed model
resulting from our study and which better
explains the brand-building process in
SMEs. This model is explained in detail in
the Results section.

Following Silverman (2004), a qualitative
approach was judged to be the most appropriate in order to answer the research question as our aim was to make sense of
and interpret the phenomenon of SME
brand-building. Qualitative methodology
is well suited to exploratory research and
has been recommended for use in areas
not well understood, such as SME brands
(Easterby-Smith et al, 1991; Creswell, 1998).
Furthermore, qualitative research may help
explore the changing and evolving context
of marketing activity within SMEs (Carson
and Cromie, 1990). The case study method
(Yin, 2003) was used as the main method
of data collection. The type of case study
used was holistic multiple case studies as the

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Five phases of SME brand-building

Brand Identity
Brand as a

Brand as an

Brand as a

Brand as a


Brand Packaging
Sales Activities
Channel Distribution
Point of Purchase


Figure 1:

Brand Communications


Brand Activities
Product Development

A priori conceptual framework.

Brand Differentiation & Feedback


Focus on
Brand as A
Owners tacit
Phase 1



Brand as A
HiatusProduct &
Phase 2

HiatusBrand as A

Phase 3

Brand as An

Phase 4

Phase 5


and Trust


Brand Owners Commitment &

Starting Stage

Figure 2:

Brand Identity
And Brand

Fitness of




Development Stage

The five phases of SME brand-building.

researchers were interested in interviewing

owner/managers from a wide range of products and services in various categories as
a means to reaching a reasonable level of
The units of analysis were the SMEs
in the sample. The sample of this research
was selected in order to fit the theory
under study (Silverman, 2005). SMEs were
selected with the following criteria: having
10 to 250 employees, with relatively small
market presence, independently owned and
managed by owner/manager(s), and actively
implementing brand activities such as brand

communications, sales, packaging design

and new product development. A total of
30 firms and 35 owner/managers were
involved divided in two waves. The first
wave included 34 semi-structured interviews and a second wave (which included
six interview/discussions) served to validate
preliminary findings. Semi-structured interviews were carried out as such interviews
offer enough flexibility for discussion and
exploration while keeping the interview in
the right direction and within interview
time constraints (Patton, 2002). This type
of interview is particularly useful when

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Centeno et al

collecting data from owner/managers of

SMEs (Curran and Blackburn, 1994). The
themes covered in the interviews were the
four dimensions of brand identity (Aaker,
1996): brand as a product, brand as an
organisation, brand as a symbol and brand
as a person; brand differentiation, brand
activities and brand difficulties during
brand construction, brand owner/manager
influences and brand budget.
Thematic coding was used for data analysis
as recommended when large amounts of
data are used to develop a theory (Boyatzis,
1998; Strauss and Corbin, 1998). Additionally, concurrent use of data reduction, data
displays and conclusion drawing and verification were used for data analysis (Miles
and Huberman, 2002). Data analysis followed four stages: preparatory planning,
open coding, axial coding and selective
coding (Strauss and Corbin, 1998). These
stages helped data analysis move from
descriptive analysis to analytical abstraction
(Carney, 1990) using a combination of primary and secondary research tools including
NVivo, research memos, research journal
and displays. All interviews were transcribed
and systematically and objectively open
coded by explicitly defining and describing
the codes (Boyatzis, 1998). NVivo assisted
in securing trustworthiness as it helped to
systematically and objectively compare and
contrast codes within and among transcripts
(Flick, 2006). A research journal was kept
in relation to the theory, conceptual framework and possible findings. In particular,
notes were written after the end of each
coded transcript and at the end of every
five coded transcripts as means to reflect on
the latest findings. These periods also helped
in making comparisons between cases
within the same set and against previous
sets of five interviews.
Inter-observer agreement occurred at
the conceptualisation phase through the
agreement on the four brand identity dimension, that is, brand as a person, brand as a


product, brand as a symbol and brand as

an organisation. With such agreement,
researchers expected of course to have interobserver agreement on the coding. While the
data moved from stage to stage, researchers
shared parts of the code development, code
analysis, and findings with two experts of
NVivo and three experts on branding to
better secure non-bias and confirm proper
data development and findings.
Finally, as means to bring together and
marshal most of the findings, the authors
used the process of data analysis recommended by Strauss and Corbin (1998) to
develop an enhanced a priori conceptual
framework. By means of an iterative systematic analysis of theme comparisons at all
four data analysis stages, the researchers went
back to evaluate the a priori conceptual
framework. They found that it did not
portray the total story of what the data
analysis had shown. The following reasons
were: there were different relationships
among the concepts, new concepts emerged,
new relationships were relevant to portray
and it required acknowledging a prior
stage of creation before presenting the
existing four dimensions of brand identity.
There was an important story to tell about
the intricacies and difficulties behind this
sequential process of brand building. A final
model, as presented in the Results section,
represents the story of how brand identity
and brand differentiation were both created
and developed.

The following sections present our findings
in regards to each one of the four brand
identity dimensions brand as a person,
brand as a product, brand as a symbol and
brand as an organisation.

Brand as a person dimension of

brand identity
We find clear indications of the close relationship between the personality of the brand

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owner and the personality of the brand. In

some cases and consistent with the literature
(see, for example, Krake, 2005), the brand
was the personification of the brand owner:
The brand name has the name of my wife
I would say that the brand is openminded and extrovert because that is the
way my wife is, she is hyper-open and

products. Such a finding supports Merrilees (2007) argument that opportunity

recognition is the first key factor that helps
brand owners start successful brands. Opportunities seemed to be linked to a market
trend or gap, as described by respondents as
The opportunities are there, but you need
to grasp them, otherwise they will pass by;
She started to realize that there was a gap in
the market for a baby brand in the Internet

A similar comment emphasised the close

link between the personality of the owner
and the personality of the brand:
The personality of Karla (the brand owner)
permeates throughout the entire firm. In
other words, if you want to define Karla,
sorry I meant X (the brand name) in
one person, is Karla.

Some cases suggest that the personification of the brand owner decreases as the
SME grows. That is, as more members of
staff are involved in brand decisionmaking, the level of personification may
decrease, as the following respondent
statements indicate:
I cannot think and do not agree to think
that I am the personification of the brand.
The brand is not myself, the brand is the
entire company, the brand is everyone in
the company,

The brand is Mr Moran, the technical
engineer, the brand is Laura in charge of
the marketing area and Tony who sales
the products to our clients, all of us are the
personification of the brand, not only me.

Brand as a product dimension of

brand identity
Responses on this dimension showed
that brand owners were knowledgeable
about their products. Twenty-two brand
owners envisioned an opportunity in
the marketplace before developing their

I then realized that there was a key

limitation in technology to balance
flavour attributes and fat content, which
is when we started developing our own
manufacturing machines.

Twenty-six brand owners were found to

be producing their product for the first
time. Most of them appeared to go through
an exploration phase by which they learned
how to produce their original product and
subsequent new products. Twenty-four of
these brand owners mentioned that brand
differentiation was based on product differentiation as they attributed brand differentiation to product newness. New
product development appeared to be one
of the most actively sought activities
among brand owners. This finding supports relevant literature on the innovative
capabilities of many SMEs (Carson and
Cromie, 1990; Cunningham and Lischeron,
1991; Bhide, 1994; Carrier, 1994). Furthermore, all brand owners made reference
to some type of new product development
ranging from line to brand extensions to
new brands. In four cases, new technology
and patents supported product development, thus contributing to the long-term
protection of brand differentiation.

Brand as a symbol dimension of

brand identity
Three main themes were raised in relation
to this dimension: brand name, logos and

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Centeno et al

colour. Brand owners appeared to be aware

of the importance of choosing a good brand
name. Some of their strategies were that
names had to be short and simple, attractive, easy to recall and evoke positive
associations and benefits.
This dimension was found to have a short
preceding brand exploration phase as many
brand owners were usually supported by
external graphic designers who helped create
most of the symbols:
When we created the visuals and logo,
we called in a graphic designer who we
knew she had previously developed some
designs in cloths using similar motifs.

Additionally, symbols varied in complexity,

from simple lines and curves to complex
brand characters. Finally, 16 brand owners
mentioned that colour helped create brand
recognition. Colour was found not only to
help communicate certain associations in
regards to product attributes and benefit,
but also brand personality, as one respondent
People will not recall our brand name, but
they will immediately recall the colour of
the product and know what brand we are
referring to.

The specific qualities of an individual colour

were also alluded to by one respondent,
who suggested that:
Orange is a very happy colour, it invites
to do things, it calls for action. Its not as
aggressive as red, and its not as passive as

This finding supports the results of prior

research into the role of colour and meaning
in corporate visual identity (Hynes, 2009).

Brand as an organisation dimension

of brand identity
Our findings suggest that SMEs have some
key overarching organisational values. These
values were found to be team-playing, open


communication, creativity, drive for quality

and innovation, and interest in management
The main organisational value is innovation,
in other words, change. There is a preference
for change and a promotion for change.
Posts are not pre-defined and everyone is
expected to help out others, everyone needs
to change, to become dynamic, and being
in a constant innovation.

This theme was also highlighted by

another respondent, who stated:
What we have tried to create is a working
environment where there is an openness
to create, with no limits to risk taking
errors and failures are welcomed, but
always as means to capitalise some learning
from them.

These findings reflect key SME characteristics that suggest they have informal and flat
structures, minimum established processes
and controls with shared values and close
personal relationships (Carson and Cromie,
1990; Carrier, 1994). At the same time,
SMEs were found to have a set of unique
organisational values driven by the personal
values and vision of the brand owners
(de Chernatony, 2001). This finding may
pose a key source for brand differentiation.

The role of the brand owner in

brand identity
Our findings suggest that brand owners take
centre stage in the starting and developing
stages of brand building as they are involved
in the creation and developing of each one
of the brand identity dimensions and brand
activities involved in the process. Figure 3
displays the importance of the brand owner
manager in brand indentity. Thus, it is not
the purpose of this section to repeat what
has already been presented, but to highlight
the significance of the role of brand owners
in brand-building. Moreover, the findings
support prior literature that acknowledges

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Five phases of SME brand-building

Brand as a Product

Brand as an

Brand owner/
Brand as a Symbol

Figure 3:

Brand as a Person

The brand owner/manager dimension of brand

the importance of brand owners drive and

commitment to their organisation (Loecher,
2000), exemplified by the following respondent statements:
You have to make your people fall in love
with your business,

I want to believe that Im the one that
drives the brand forward.

Furthermore, their commitment towards

their brands is partially derived from a personal choice and preference. The findings
suggest that the selection of a particular
brand product and category was based on
a personal preference and choice:
Since we were children my sister and I
loved these type of activities, she liked
to scuba dive and cooking while I loved
rock-climbing, road biking and yoga.

Similar views were expressed by other respondents, as follows:

This business was based on a high-school
project. Ive always been a fan of sports,
especially football, so with my liking and
knowledge on football we decided to start
this business five years ago,

Ive been ice skating for forty-five years,
I couldnt go one single day without
skating, skating becomes a passion.

These examples show that brand owners

are driven by a personal choice and preference which help their own drive and commitment.


Figure 2 shows our proposed model of
how brand building is developed in SMEs.
According to Strauss and Corbin (1998)
there are starting and consequential conditions to the phenomenon. The starting
conditions were defined as events or incidents that lead to the occurrence or development of a phenomenon (Strauss and
Corbin, 1998). Grouped into positive and
negative conditions affecting brand building,
positives were owners tacit knowledge,
creativity and intuition. Negatives were
complexity, uncertainty, minimum resources and planning, among others. The consequential conditions defined as outcomes
or results of action and interaction (Strauss
and Corbin, 1998) were order, long-term
planning, proactivity, brand recognition
and trust among others.
Findings suggest that the phenomenon
of brand-building is composed of two
stages, a starting and a development stage.
The starting stage included four phases in
which each one of the brand identity
dimensions is created and the development
stage composed of one phase of brand identity development. During these two stages,
brand owner/managers (BOMs) learn new
sets of competencies.
In the starting stage, brand as a person
was created when brand owners committed
themselves to starting their brands. Even
when brand owners were not aware of
this dimension, findings suggested of its
existence as parallel similarities between
their personality traits and that of their
brands. The second dimension to be created was brand as a product. The findings
suggested that brand differentiation was

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Centeno et al

created simultaneously at this phase. Brand

differentiation was found to include particular levels of newness of product
attributes and benefits. Thus, a close link
between product and brand differentiation
was found. The third dimension to be created was brand as a symbol. Brand owners
were found to be keen in creating a brand
name, logos and visuals of their products.
The last dimension to be created was brand
as an organisation. The findings suggested
that brand owners brought in their personal
values which in turn became some of the
organisational values.
During the fifth phase, brand owners
continued developing each one of the
dimensions as means to grow their brands
and in due course reach a set of consequential conditions of the process.
However, this sequential process did not
appear to be straight forward mainly due to
the starting conditions. Brand owners went
through iterative hiatus/brand exploration
phases before each one of the phases. These
exploratory phases involved many experimentation and trial and error activities until
they became knowledgeable to move on to
the next particular phase.
There were two more key elements of the
process. First, the brand owners commitment and drive that drove forward the
brand-building process. Second, the feedback throughout the process that was found
to be those learning outcomes from which
brand owners and members of SMEs
learned to build their brands.

This study explores for the first time the
process of the creation and development of
brand identity in the SME context. We
present in previous sections a theoretical
model (see Figure 2) that illustrates the two
main stages of brand-building (starting stage
and development stage) as well as the five
key phases of SME brand-building, namely,
brand as a person; brand as a product and


brand differentiation; brand as a symbol;

brand as an organisation; and brand identity
development and brand growth. The study
contends that SME brands are built in a
non-traditional manner as they were found
to have minimum brand planning and limited resources. Furthermore, contrary to
large firm brand-building, SME brands are
built from an innovative, experiment-oriented and resourceful approach. Specifically,
they were found to engage in brand exploration phases where they experimented and
did trial and errors under risk, commitment,
creativity and willingness to learn.
Our findings suggest that the phenomenon of brand-building is a sequential
process of brand-building composed of two
stages and five phases of brand-building. In
the starting stage comprised of the first four
phases, each one of the four dimensions of
brand identity is created. In the development stage and fifth phase, brand identity
is developed.
This sequential process of brand-building,
however, did not appear to be straightforward as SME brands went through
hiatus/exploratory phases. This finding
supports prior literature arguing for periods
of instability in SMEs as they go through
a growth process while learning new competencies (Scott and Bruce, 1987; Mount
et al, 1993). These exploratory phases
involved much experimentation and trial
and error activity stimulated by a quest to
learn. Such phases helped SMEs to develop
new skills and knowledge, which in turn
helped them move on to the next brandbuilding phase. Figure 2 displays the process
in more detail.
Additionally, the brand owners commitment and drive drove forward the brandbuilding process. This finding supports
previous research, which argues that owners
not only take an important role within
the management of SMEs, but also take
a lifelong responsibility called the personal
principle by which the owner develops a

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Five phases of SME brand-building

lifelong commitment to the firm (Carson,

1990; Hadjimanolis, 2000; Loecher, 2000).
Lastly, the process included feedback that
was found to be those learning outcomes
from which brand owner/managers and
members of SMEs learned to build their
brands. At the same time, it was found that
brand differentiation was not only perceived
as part of the brand as a product dimension
of brand identity, but was developed into
other brand dimensions as well.


This study may assist managers in creating
and developing a brand identity by means
of four brand identity components that are
key elements to brand-building: brand as
a person, brand as a product, brand as a
symbol and brand as an organisation.
Brand owner/managers in the study demonstrated different skills that are important
in the construction of the brand. Managers
should develop an inventory of their skills
and competencies as these will likely have
an effect on their brand-building activity.
SME brand managers need to be prepared
to learn how to manage in conditions of
complexity and uncertainty. Many of the
new skills and knowledge gained by SME
brand managers will be derived from
periods of experimentation and trial and
error. Managers need to be aware of how
these skills relate to and impact upon each
of the four dimensions of brand identity.
The study findings suggest that brand
owner/managers instil some of their personality traits into their brands. The SME
brands in our sample were found to have
close similarities with the brand owner/
manager personality and in some cases were
the personification of the brand owner/
manager. Awareness of the closeness of
such personalities is important during the
brand-building process as it will help develop
appropriate brand strategies in terms of
developing other brand components with

more congruency such as emotional benefits and brand values. SME brand owner/
managers should be conscious that they are
leaving an imprint and legacy to their brand
in the long run.
In terms of the brand as an organisation,
the study findings suggest that SME brands
require having people who can follow
two sets of organisational values. The first
set contains those values which are the
owners own. They permeate throughout
the organisation. These values may also be
a differentiating factor and may offer some
level of uniqueness to the brand. The second
set of values contains particular values that
are mainly due to the small structure and
informality of most SMEs. These values
comprise team-playing, commitment, open
communication, creativity, honesty, flexibility, motivation and innovative thinking
and action. Many brand owner/managers
were found to be in daily oral communication with their members of staff and were
ready to have a close relationship with their
members of staff.
An additional managerial implication from
the study is that a lack of financial resources
is not necessarily a barrier to brand growth,
but may rather be a driver of creativity.
Some brand owner/managers suggested that
their lack of financial and human resources
helped them become more creative by stimulating them to seek innovative ways of
implementing brand activities. In such ways,
they were not only reactive to the market,
but became proactive.


A limitation of this study is that it is firmcentric, that is, it presents a supply-side
perspective on how brands are built, namely
from the brand owners perspective. Future
research should also investigate consumer
perceptions of the SME brand-building
process. One of the major challenges, however, in such an approach is the difficulty

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Centeno et al

of accessing an adequate sample of consumers who have a critical base of brand

knowledge to discuss such a process. A
solution to this challenge may be to access
customer databases of SME brands. A second
limitation of the study is that it generalises
across different SME brand sectors. Future
research should examine the SME brandbuilding process on a sectoral basis in order
to ascertain whether the process varies significantly from sector to sector. Third,
although this study explains how brand
owner/managers handle uncertainty and
complexity through the phases of brand
exploration, more research is required in
order to understand the fuzziness of such
phases. This study contends that there are
some key characteristics intrinsic to SMEs
that help them move from not knowing to
learning and to implementing certain brand
identity components. Characteristics such as
attitude towards risk-taking, willingness to
innovate, sense of accomplishment, intuition
and other factors may play an important role
in such phases. It may also be useful to investigate how brand exploration relates to the
process of new product development in the
context of SME brands.
1 In his report card, Keller identifies 10 factors that the
worlds strongest brands gained as they grew in strength,
so that brand managers may profit by systematically assessing their own brand performance and benefit from
these successful brands. Some of the traits suggested for
consideration are excellent delivery of customer benefits
and brand relevance. All traits suggest brand equity improvement and strength.

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