BRANDING STRATEGY ON ECONOMIC SUSTAINABILITY AMONG PERSONAL CARE AND COSMETICS CUSTOMERS

Al Amirul Eimer Bin Ramdzan Ali¹ --- Abdul Kadir Othman² --- Faridah Hj Hassan³⁺ --- Muhamad Izzuddin Zainudin⁴ --- Ahmad Syahmi Ahmad Fadzil⁵

^1,4,5PhD Candidate, Universiti Teknologi MARA,40450, Shah Alam, Selangor, Malaysia

²Senior Lecturer, Universiti Teknologi MARA,40450, Shah Alam, Selangor, Malaysia

³Professor,Arshad Ayub Graduate Business School Universiti Teknologi MARA 40450, Shah Alam, Selangor, Malaysia

Keywords:Branding strategy Economic sustainability.

ARTICLE HISTORY: Received:18 June 2018 Revised:2 August 2018 Accepted:12 September 2018 Published:29 October 2018.

Contribution/ Originality:This study contributes in the existing literature on branding strategy by including Halal branding strategy. Most studies investigate Halal as part of separate phenomenon such as marketing strategy, and Halal certification system. It is hoped that this article may contribute to the existing literature on branding strategy

1. INTRODUCTION

Personal care and cosmetics products have been established since thousands of years ago.  These personal care and cosmetics products are being used daily by many people and the consumption of these products is increasing every year (Hashim and Mat Hashim, 2013 ).  In the earliest decades, this industry was originated from the ancient cultures and these cultures were associated with the individual’s aesthetics and appearance today. 

In the current era, there is a growing interest in a new product-Halal cosmetics and personal care (Mohezar et al., 2016 ).  In order to differentiate from the conventional cosmetics products, the Halal cosmetics brands do not contain porcine- by products and do not contain alcohol (Hashim and Mat Hashim, 2013).  The Halal cosmetics should be manufactured, stored, packaged and most importantly distributed according to the Islamic teaching.  The Halal beauty products are also recognized as clean, safe and of high quality (Mohezar et al., 2016 ).  Among the top Halal cosmetics brands are Iba, Wardah, PHB Ethical Beauty, Simplysiti, and Amara Cosmetics.  Halal cosmetics products are suitable for both Muslims as well as non-Muslim consumers in terms of the ingredient, process, and nature of the products. The religiousity and safety concepts associated with the Halal personal care and cosmetics product influence the customers to purchase it.  In this view also, the fundamental concept of Halal personal care and cosmetics is considered both in physical and spiritual aspects, which are taken from the halal and tayyib’s law.  Halal personal care and cosmetics are “Halal” if they comply with the Islamic law.  In this law, it states that the halal products must not contain any human part or ingredient or contain any animal by product which is forbidden to Muslims. 

According to Jit Singh Mann and Kaur (2013 ) there are three classifications of branding strategies.  Firstly, is the corporate-dominant strategy and this can be best defined as the strategy in which the corporate brand name is used in all communications or products from the company.  The second strategy is the brand-dominant strategy where different brand names are used for various products and services of the company and lastly, mixed branding strategy which involves the combination of two names, corporate and individual brand names which are used simultaneously with different visibilities for products and services from the organizations. 

Sustainability has been widely discussed by academics from various corporate disciplines including management, marketing and operations.  The various dimensions of nature scientifically established knowledge on sustainability has created several terminologies (Kumar and Christodoulopoulou, 2014 ). Dyllick and Hockerts (2002 ) perceived the sustainability of the business is the capability to meet the desire of the firm’s direct or indirect stakeholders.

The problem of this study arises when there are certain brands in the market known for not contributing to the sustainability affairs, hence, consumers tend to develop a skeptical outlook and unfavorable attitude towards the brand for a certain period (Mattar, 2016 ). According to Alizadeh et al. (2014 ) organizations are having difficulties to influence customers to purchase their brands instead of their competitor’s brands despite of practicing its best branding strategy.  If the organization does not revamp or rethink of its branding strategy, it might be having tough time to differentiate itself from other organizations.  The organization needs to convince the customers that the brands offered are having higher values than the competitors.

For an organization to sustain its business for a longer period, it is very important for it to understand the different segments of economic sustainability from the perspective of the customers by engaging with them to find out new ways to enhance its economic sustainability.  According to Dhar et al. (2010 ) most of studies on economic sustainability focus on the perception of the organization.  Therefore, this study is intended to measure economic sustainability form customers’ perspective.

2. LITERATURE REVIEW

2.1. Economic Sustainability

Economic Sustainability refers to the financial feasibility.  This dimension consists of issues such as competitiveness, job and market creation and most importantly long-term profitability.  Economic sustainability is gradually understood to refer to producing the added value in a broader sense, in comparison to the conventional financial accounting.  The economic and financial aspects of sustainability therefore may consist of effort to minimize the operating costs via systematic management of resources, secondly, minimizing the cost of operating the business and pitching for business via detailed business integrity procedures, thirdly, improve the productivity via group of personnel who are committed and motivated, fourthly, attract new range of investors and lastly, provide chances for inclusion in socially responsible investment indices (ICC, 2002 ).  The economic dimension also focuses on the value creation for the customers which will lead to the financial performance of the organization’s activity (Bansal, 2005 ). Economic sustainability reflects the aspects of growth, development and productivity that have been aligned with the conventional development science in the past.  The allocation of the market resources will allow an organization to sustain its levels of growth and consumption.  The term economic sustainability indicates a system of production that satisfies the current consumption levels without neglecting the future needs.  The term economic sustainability was originated by Hicks and through his detailed work “Value and Capital in the year of 1939 and subsequently in 1946, he defined “income” as the value one can utilize during a period and still be well off at the end of the tenure.  Conventionally, the experts in the economic field assume that the supply of natural capitals is infinite, hence, placed excessive and detailed investigations on the capacity of the market to distribute resources in an efficient manner.  The experts also believed that the expansion of the economically would give the advantage to the technological capacity to replenish the natural resources which have been destroyed along the process of production. 

2.2. Corporate Dominant Strategy

According to Jit Singh Mann and Kaur (2013 ) there are all together three Brand Architecture strategies.  First and foremost is corporate dominant strategy.  Corporate dominant strategy can be best defined as the only corporate brand name that is utilized in all sorts of communications of the company whether internally or externally.  There are few names for this branding strategy by previous authors. Olins (1989 ) has named this strategy as monolithic strategy.  Aaker and Joachimsthaler (2000 ); Sanchez (2004 ) have termed it as branded house strategy. In this strategy, corporate dominant strategy showcases conglomerate name, organization’s name and house/subsidiary name. 

2.3. Brand Dominant Strategy

The second branding strategy is brand-dominant strategy.  In this kind of strategy, different brand names, that are different from corporate brand are utilised for different products and services offered by the organization (Gray and Smeltzer, 1985 ; Murphy, 1987 ; Laforet and Saunders, 1999 ).  However, Olins (1989 ) named this strategy as branded strategy whereas according to Aaker and Joachimsthaler (2000 ) and Sanchez (2004 ) named it as branded house strategy.  Brand-dominant strategy is the strategy where individual brands are formed and strengthened with limited connection to each other or to the corporate brand. 

2.4. Mixed Branding Strategy

In this branding strategy, two (2) brand names, which are corporate and individual products brand names are utilized together with the aim to vary the visibilities to brand the products and services offered by the organization (Gray and Smeltzer, 1985 ; Murphy, 1987 ). Olins (1989 ) has given the term as endorsed strategy whereas (Aaker and Joachimsthaler, 2000 ) named it sub-branding strategy while (Sanchez, 2004 ) named it as brand endorsement strategy.  These different terminologies carry the same meaning, all of which contain the existence and presence of the main brand or corporate brand but with varying degrees of product brand reliance depending on how the corporate brand is positioned. In a mixed branding strategy, the organizations engage a set of house or family brands, such as subsidiary names, in their portfolio and this is an addition to using the corporate name for certain services and products offered by the organizations. 

2.5. Halal Branding

The term Halal is derived from an Arabic word that is linked to the Islamic faith.  Halal in its generic sense, can be defined as allowable or permissible.  The terminology of Halal should be understood by every Muslim.  This is also further supported by Wilson and Liu (2010 ) where a basic theory of understanding of what Halal is all about and it is central to every Muslim’s belief, in which, the term falls under the umbrella of what is measured to be the evidence that is known by necessity.  On the other hand, the antonym of Halal is Haram.  Haram seems to resonate in the eyes of the customers with a strong sentimental feeling (Wilson and Liu, 2010 ).  This is due to the conscious or engagement in activities that are forbidden, without any regret, carries the risk of punishment, which is stipulated in the Islamic law or in the hereafter. 

2.6. The Relationship between Corporate Dominant and Economic Sustainability

According to Barwise and Thomas (1992 ) corporate dominant offers maximum coverage of economies of scale and scope, specifically via communications at a corporate level. This would also provide an advantage in the demand side that would increase the returns despite having limited benefits. Corporate dominant is perceived as valuable resources in which the organizations use it to differentiate themselves in the global competitive market.  Jo Hatch and Schultz (2003 ) stated that the corporate dominant strategy is a platform for any organization that contributes to the value of the organization and it is linked to its products and services besides its stakeholders.

The relationship between brand dominant and economic sustainability

In comparison to the corporate dominant strategy, brand dominant strategy is a strategy that organizes products and services as independent brand, which allows an organization to gain compatible demand-side advantages via the enhancement of cash flow (Hsu et al., 2010 ).  Brand dominant strategy allows the organization to achieve economic sustainability by operating in a tactical way and broadens its market coverage to different kinds of customers as the organizations offer various products and services targeted to different markets.  In this strategy also, the brands are leveraged in the design, the name of the brand, brand’s identity, brand’s personality, brand’s value, positioning of the brand and the communication for specific targeted market and this allows organization to create intimate relationship with targeted customers which will create “repeat customers”. Brand dominant strategy will not be facing any restriction or barrier from the corporate brand connection, hence, allowing revenue opportunities to flow in via distinctive customized products, prices and services.  Aaker (2004 ) further supported this by stating that brand dominant strategy would protect the organization to protect from market downturns and lower the financial risk (Hsu et al., 2010 ). 

The relationship between Mixed Branding and economic sustainability

Mixed branding strategy will derive benefits from the corporate dominant strategy while gaining the protection offered in the secondary brands.  A key success of mixed branding strategy is to gain-supply side economies in marketing, communication, operations and distribution via corporate brand association and this also can be achieved by leveraging the demand-side advantages by market segmentations with different brands (Aaker, 2004 ).  For both demand and supply side of economies, mixed branding strategy will ensure the accrue of cash flow which is not delivered via a pure corporate branding strategy.  According to Rao et al. (2004 ) mixed branding strategy will assist the organization to achieve its economic sustainability through the benefits of the corporate brand strategy and this will increase the possibility to create a different product -class associations for various brands offered by the organization.  Multiple brands under mixed branding strategy allow the organization to serve various market segments by tailoring offers that suit the need of the markets. 

The relationship between Halal Branding and Economic Sustainability

According to Ahmad (2013 ) the Halal branding will contribute to economic sustainability as this branding strategy is perceived as a critical issue in the fast-growing markets and economy especially in Muslim countries.  According to United Nation, the growth rate of Muslim is even faster than the non-Muslim which can achieve a total number of 2.6 billion by 2050. Temporal (2011 ) stated that halal branding will contribute to economic sustainability as this branding is perceived as a powerful brand that creates an impetus to further develop a business that is competitive with other brands.  Halal branding is going global because of its capability in contributing to the economic development and will shape the national image.  Halal branding is also treated as an essential feature of stable and growing economies in any country.

Conceptual Framework

Figure-1. Conceptual Framework

Source: Souiden et al. (2006 ), Pappu et al. (2006 ) and  Khan and Azam (2016 )

Figure 1 showcases the conceptual framework of this study.  It posits that corporate dominant, brand dominant, mixed branding and Halal branding as the independent variables and economic sustainability as the dependent variable.

Hypotheses:

H1:  Corporate dominant has significant relationship with economic sustainability

H2:  Brand dominant has significant relationship with economic sustainability

H3:  Mixed branding has significant relationship with economic sustainability

H4:  Halal branding has significant relationship with economic sustainability

3. RESEARCH METHODOLOGY

This section is divided into three (3) sub-topics.  The topics covered are research design, research instruments, and population.

3.1. Research Design

This research adopted the quantitative method to address the research problem as it is proven to be most practical and cost-effective in any situations.  This type of research method allows verifications to be conducted scientifically and statistically.

3.2. Research Instrument

Research instrument used for this research was questionnaire.  As for the dependent variable of this study which is economic sustainability, the questions were derived from Suri et al. (2000 ). A sampled item for economic sustainability is “Providing excellent value of money to its customers” and the reported Cronbach’s’ alpha was 0.80.  As for the independent variable of this study, it is divided into four (4) which were corporate dominant which was derived from Souiden et al. (2006 ).  A sampled item for corporate dominant is “The company that produces this personal care brand is well-known in its industry” and the reported Cronbach’s’ alpha was 0.81. As for brand dominant, the questions were derived from Pappu et al. (2006 ). A sampled item for brand dominant is “This personal care brand offers products of very good quality” and the reported Cronbach’s’ alpha was 0.68. Mixed branding was adapted from Souiden et al. (2006 ) and a sampled item was “Overall, the company and the brand are well known” and reported Cronbach’s’ alpha is 0.74. Halal Branding was adapted from Khan and Azam (2016 ). A sampled item for Halal branding is “Halal-certified personal care products are a good idea” and the reported Cronbach’s’ alpha was 0.65.  All these questions were based on 5-point Likert scale ranging from 1= Strongly disagree to 5= Strongly Agree.

3.3. Population

The population is a group of potential participants to whom the research would like to generalize the results of the study.  One of the purposes of this study is to gauge the customer’s perception on branding strategies that could lead to business sustainability.  According to the Malaysia’s statistical department, the current population in Kuala Lumpur is 1.79 Million as of 2017.  The population of this study is the personal care and cosmetics customers at six (6) premier shopping malls namely KLCC, Starhill, Berjaya Times Square, Lot 10, Sungai Wang Plaza and Pavilion Kuala Lumpur.

4. RESULT AND DISCUSSION

Table-1. Cronbach’s’ alpha results

Scale Coefficient	Reliability Coefficient (Alpha) (n=121)
Corporate dominant	0.718
Brand dominant	0.854
Mixed branding	0.818
Halal branding	0.844
Economic sustainability	0.872

Table 1 above shows the result of reliability analysis.  The Cronbach’s alpha ranges from .718 to .912 which are deemed acceptable for the study.  the dependent variable of this study is economic sustainability with a Cronbach’s alpha of .872

Table-2. Demographic profile of the respondents

Variable	Descriptive	Frequency	Percentage
Gender	Male	42	34.7
	Female	79	65.3
Age	Below 18	11	9.1
	18-23 years old	11	9.1
	24-29 years old	48	39.7
	30-34 years old	21	17.4
	35-44 years old	20	16.5
	45-49 years old	9	7.4
	50 years old and above	1	0.8
Marital Status	Single	75	62
	Married	45	37.2
	Others	1	0.8
Monthly Income	RM 1000 and Below	17	14
	RM 1001 - RM 3000	37	30.6
	RM 3001 – RM 5000	42	34.7
	RM 5001 – RM 7000	19	15.7
	RM 7000 and Above	6	5
Preferred Brand	Mary Kay	11	9.1
	Wardah Beauty	3	2.5
	Simply Siti	13	10.7
	Loreal	24	19.8
	Procter & Gamble	19	15.7
	Unilever	23	19
	D Herbs	2	1.7
	Sari Ayu	5	4.1
	Revlon	8	6.6
	Others	13	10.7
Duration of usage	Less than a year	15	12.4
	One Year	13	10.7
	Two years	35	28.9
	More than two years	58	47.9

Based on the findings above, majority of the respondents were female with the total number of 79 (65.3%), 48 (39.7%) of the respondents aged 24-29 years old.  As for the marital status, 75 (62.0%) respondents were single, 42 (34.7%) and respondents earned between RM 1001 and RM 3000 as their monthly income, 24 (19.8%) respondents preferred to use Loreal and lastly, 58 (47.9%) respondents used their personal care and cosmetics products for more than two years. 

Table-3. Correlation between branding strategies and economic sustainability

No	Variables	SD	Mean	1	2	3	4
1	Corporate dominant	0.42178	3.9901
2	Brand dominant	0.46814	4.1868	.545**
3	Mixed branding	0.48949	4.1917	.415**	.557**
4	Halal branding	0.48685	4.2786	.232**	.190*	.170*
5	Economic sustainability	0.51147	4.2083	.180*	.433**	.354**	.293**

Table 3 above indicates the outcome from the relationship between branding strategies and economic sustainability.  From the findings, corporate dominant has very low correlation with economic sustainability (r=.180, p<0.01), mixed branding (r= 3.54, p<0.01) and Halal branding (r= .293, p<0.01) have low correlation with economic sustainability.  The findings also indicate that brand dominant (r=.433, p<0.01) has a moderate correlation with economic sustainability.  However, the organization should also focus on its brand image as it will enhance its reputation, which will lead to the brand -favouritism among its customers.  Once the organization can create a favourable image of the organization, any product offered will then be purchased by the customers.

Table-4. Multiple regression between Branding Strategies and Economic Sustainability

Model	Standardized Coefficients Beta
Corporate dominant	-0.148
Brand dominant	.378**
Mixed branding	0.167
Halal branding	.227**
R	0.513
R2	0.263
Adjusted R2	0.237
F Change	10.344
Significance F Change	0
Durbin Watson	1.438

The above table shows the findings of multiple regressions between branding strategies and economic sustainability.  As illustrated in the table, the F value was 10.344.  The F value helps to show the details of the relationship between the regression and the residuals.  The R2 of 26.3% is the variance in economic sustainability which is explained by branding strategies.  Based on the findings, only brand dominant and Halal branding are significant in influencing economic sustainability.  Hence, the hypotheses 2 and 4 were supported.     

Brand dominant strategy is a strategy that allows an organization to create several individual products that act as personal products and services which are not associated to the parenting organization that enable the organization to create competitive advantage and generate more economic sustainability derived from the individual products and services (Hsu et al., 2010 ).  Brand dominant strategy allows the organization to alter their products and services to different market segmentations and tailored the customers’ needs and wants. According to Manova and Yu (2017 ) organizations with product differentiation coupled with quality features will achieve maximum sales which will lead to sustainability.

The findings depicted that the individual products offered by the organization will allow them to achieve competitive advantage by generating economic sustainability and this can be achieved by producing quality products.  Since brand dominant is not linked to its parenting organization, the revenue earned by its individual products will be used for further improvement which would generate more economic sustainability.

Halal branding will contribute to economic sustainability as this branding strategy is crucial especially in the rapid-growth market and this can be seen not only in Muslim countries but globally (Ahmad, 2013 ).  Temporal (2011 ) stated that since Halal branding is not only about the ingredients, but the quality of the product itself will lead to economic sustainability as this branding is perceived as a competitive brand.  Since the demand of the Halal personal care and cosmetics are growing, not only from Muslim consumers, but the non-Muslim consumers, it is expected that it will give an impact to the economic sustainability of an organization. Both brand dominant and Halal branding are perceived to be the centre of importance to the organizations and stakeholders.  In view of this, these two (2) brands are the upsurge of the interest of the organizations that these two brands can be considered as stand-alone assets to the organization.  Since branding is crucial to an organization, it is very important for the it to leverage on these branding strategies in creating the brand awareness amongst its customers in order to capture their attention (Balmer, 2017 ).

5. CONCLUSION AND RECOMMENDATIONS

Taking into consideration of today’s national agenda (Transformational 50), it is very important for the organization to consider business sustainability as one of their main agendas in ensuring the sustainability of the business for a long run. It is also crucial for the organization to reconsider its current branding strategies to fit the current market demand as the market is rapidly changing. As a conclusion, this study contributes to the growing body of literature on branding strategies by identifying which branding strategy that contributes to economic sustainability. To create a very strong and concrete branding strategy, the organization must be clear of its business vision and goals.  The organization needs to understand its business value (i.e, acquisition, growth, or sale).  This is because, different sets of branding strategy will give an impact to the business value. 

Hence, it is important for organization to leverage on branding strategy that will lead to economic sustainability.  For instance, brand dominant strategy can be considered as one of the efficient branding strategies as it allows the organization to take full liberty in creating the brand identity, where the organization could create different brand strategy, logo, design or perhaps creative campaigns that are not linked to another product. Lastly, since there is a huge demand of halal products from Muslim and non-Muslim from all over the world, it will be an advantage for organization to implement Halal branding as it will lead to economic prosperity in the organization   

Funding: This study received no specific financial support.

Competing Interests: The authors declare that they have no competing interests.

Contributors/Acknowledgement: All authors contributed equally to the conception and design of the study.

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