Family-based brand influences customers’ choiceAugust 15th, 2008 - 1:26 pm ICT by IANS
Washington, Aug 15 (IANS) The tag of ‘family’ business positively influences customers’ choice, according to a new study. Family businesses comprise an estimated 80 percent of the 15 million businesses in the US, contribute to more than 50 percent to its gross domestic product and generate 78 percent of new jobs.
Justin B. Craig, Clay Dibrell and Peter S. Davis investigated whether family firms benefit from initiatives to develop and promote the family aspects of the company as a basis for competitive advantage and thus enhance performance.
A survey of leaders drawn from 399 family businesses showed that they influenced their customers by reminding them that there is a family behind the business and not a faceless corporate entity.
The authors suggested that this finding is linked to a family business’ long-term strategic horizon, the high priority family businesses place on community involvement, and the reputation of the family name all of which translates to a perception of greater value to the customer.
“Our study offers practitioners several relevant insights into how a family business can elevate financial performance,” the authors noted. “Ultimately, as the backbone of most economies throughout the world, family businesses contribute to the economic and social fabric of their communities.”
Tags: backbone, community involvement, competitive advantage, corporate entity, craig, dibrell, family business, family businesses, financial performance, gross domestic product, high priority, horizon, initiatives, new jobs, perception, relevant insights, reputation, s davis, social fabric