The Mechanism of Market Driving with a Corporate Brand - The Case of a Global Retailer

University dissertation from Lund Business Press

Abstract: The purpose of this thesis has been to analyse the mechanism of the market driving approach carried out by a global organisation with a corporate brand. Market driving is a new organisational approach to strategy that lacks a solid theoretical framework, but constitutes a reality of global firms such as IKEA, The Body Shop, Benetton, Dell, Hennes and Mauritz, Starbucks. In the literature, the market driving strategy is linked with the ability of a firm to produce a leap in customer value due to a unique business system and value proposition. Thus, the major focus is on the tangible organisational resources for value creation. In my study, I have analysed the ability of a firm to use the corporate brand as a major intangible resource for value generation. This thesis argues that a corporate brand provides a context and a mechanism for value creation in market driving. It has also broadened the concept of customer value to include all major organisational stakeholders. The study draws on the theories of market orientation, market driving, corporate branding and partly on the stakeholder theory. The basic premise is that the cross-fertilisation of these theories is beneficial for the development of a new theory in market driving, while corporate branding provides a relevant explanatory theory for a deeper understanding of the organisational driving forces of this phenomenon. The case study of IKEA in three markets - Russia, China and Poland - has been carried out using in-depth interviews with managers at corporate and local levels as well as local suppliers as major sources of evidence. The systematic combining of theory and empirical data has allowed the creation of a coherent conceptual framework for the study. It has been used to explain the dynamics of the market driving approach towards different stakeholders globally and locally. It has been shown that corporate branding provides a company with a powerful alignment mechanism for marketing processes and value amplification, allowing it to create a leap in stakeholder value. The broad stakeholder perspective taken by a firm allows it to develop an integrated market driving approach, in which the role of a corporate brand is to provide the basis for all strategies.