Co-Branding as an Entry Strategy for Emerging Markets? A Case Study Based Investigation on the Chinese market.

Malte Erich Elborg & Judith Tedros

Student thesis: Master thesis


Co-branding has become a frequently used and accepted form of brand alliance across multiple industries (Cooke & Ryan, 2000), as it enables companies in taking advantage of other brands which have already developed brand equity through collaboration (Keller, 2013). However, it has been pointed out that this area of research still lacks fundamental research in the context of emerging markets. These play an increasingly significant role due to their tremendous continuous economic development. China respectfully has been a driving player of the world economy, which has, since its emergence, indicated significant socioeconomic changes. Its middle class population is supposed to develop from 6% in 2010 to 51% in 2020 (Atsmon, Magni, Li, & Liao, 2012). Currently, the most common entrance strategies to the Chinese market are joint ventures or mergers and acquisitions which represent high risks in the form of financial investments and are characterised by a high failure rate (Cui & Liu, 2000). As co-branding comes along with less financial and organisational investments and has the potential to overcome cultural barriers and increase consumer acceptance, the focal point of this thesis is to investigate co-branding as an alternative strategy to already existing forms of market entrance, in regard to the Chinese market. More specifically, it will apply a consumer centric perspective, evaluating the influence of a co-branding arrangement consisting of a foreign and local brand in relation to customer acceptance. To empirically test the applicability of co-branding as an entry strategy, a cross sectional research design involving a focus group as well as an online survey was completed. Within the quantitative part of this study, brand equity has been applied to measure the difference in response between three fictional scenarios consisting of a foreign brand entering the market in various configurations. In spite of the findings of this research being not fully generalizable due to the chosen sample technique, they indicate relevant insights. Analysing the responses of 191 participants through the use of parametric testing, namely a t-test and an ANOVA, the study shows that the collaboration with a local brand can increase consumer evaluation. However, the choice of a partner has significant influences on the final assessment. Additionally, socioeconomic characteristics, worthy of consideration, between the different generations of China were identified. The findings are discussed in their applicability in regard to other contexts. Therefore, this study is not only highly relevant for companies entering the Chinese market, but also for companies which are already operating within it, as well as for businesses which want to apply this concept to a different market.

EducationsMSc in Brand and Communications Management, (Graduate Programme) Final Thesis
Publication date2017
Number of pages119