Impact of Direct Marketing Activities on Company Reputation Transfer Success

Impact of Direct Marketing Activities on Company Reputation Transfer Success: Empirical Evidence from Five Different Cultures

Corporate Reputation Review (2010) 13, 20 – 37.doi: 10.1057/crr.2010.5

 

If a company specialized in hospital medical devices wants the clients to buy its new pharmaceutical products, how would the company successfully introduce the new product category with its existing brand name as a brand extension? It is not difficult for a company who has a favorable reputation. A peer reviewed hypothesis testing article presents direct marketing activities impact on reputation transfer. This article is important because the author provides empirical evidence on the significance of different cultural dimensions on companies' reputation, reputation transfer and brand extensions.

 

This article tested four different hypotheses. The first hypothesis is that " There is a positive relationship between the perceived fit of the new product range and the successful transfer of reputation in the pharmaceutical industry." The second hypothesis is that " Customer satisfaction has a strong, positive effect on reputation and is influenced by Word of Mouth(WOM)". The third hypothesis is that " Direct marketing media have a substantial impact on company reputation and reputation transfer". The fourth hypothesis is that "The impact of different cultural dimensions on the reputation construct is expected to differ significantly among the surveyed countries". The surveyed countries are Germany, Finland, Spain, Russia, and Australia, all with different scores on culture differences in the categories: Individualism vs Collectivism, Masculinity vs Femininity, Power distance and Uncertainty avoidance (all the aspects are part of Hofstede's cultural dimensions). The direct marketing activities included fairs, symposia, visits of sales representatives, brochures, internet and mailings. The paper studies the impact of culture on purchase behavior of consumers of pharmaceutical products.

 

The result of this study shows that the perceived fit of new products to the existing product range has substantial impact on reputation transfer in feminine countries rather than masculine countries. The perceived fit can significantly enhance company's reputation. The reputation is also highly impacted by personal recommendations of product through word of mouth and customer satisfaction in collectivist countries. Additionally, the influence of company's reputation is significant for the countries with high power distance and high masculinity scores.

 
Culture environment differs from country to country, practicing executives and managers should know how to adjust the direct marketing activities by matching different culture to generate good reputation in international marketing.