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Title

Brand signalling: An antecedent of employee brand understanding

Abstract

There is inherent power in having a well-informed, knowledgeable workforce who

understand the organisation’s brand promise and their role in delivering the promise to

customers. Consistent delivery of the brand promise ensures customer satisfaction and

loyalty, and ultimately brand competitiveness and profitability. Despite its importance, little

research attention has been given to employees’ understanding of the brand promise and

what it means in terms of their brand-aligned behaviour. A challenge therefore exists for

organisations wanting to ensure that their brand promise is both understood and

consistently fulfilled by frontline employees. This paper responds to this need by offering a

conceptual model bringing focus to brand signalling, namely brand signal quality, brand

signaller quality and brand signal channel quality, as antecedents to the development of

employee brand understanding. The conceptual model benefits organisations by describing

the role that brand signalling plays in communicating the brand promise and elevates the

importance of employee understanding of the brand to fulfil the promise. This paper sets

the scene for future research within this important, but underrepresented field of internal

brand management research; focusing on understanding employees’ cognitive processing of

the brand and delivering on the brand promise.

Keywords

Brand signalling, signalling theory, brand promise, employees, brand understanding

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INTRODUCTION

External customers expect to receive a certain experience when interacting with a brand

(Erkmen and Hancer, 2015; Punjaisri and Wilson, 2007). Meeting customers’ expectations is

contingent on the organisation’s ability and willingness to consistently fulfil their brand

promise (Erdem and Swait, 1998). A brand promise encapsulates the functional and

emotional values, qualities and experiences associated with tangible goods and intangible

services offered by the brand (de Chernatony, 2001; de Chernatony et al, 2000; Punjaisri

and Wilson, 2007; Punjaisri et al, 2009). It is widely recognised that consistent fulfilment of

the brand promise is critical to ensuring customer satisfaction and customer loyalty, which

in turn influences overall firm competitiveness and profitability (Henkel et al, 2007; Miles

and Mangold, 2004; Santos-Vijande et al, 2013; Xiong et al, 2013). King and Grace (2009)

argue that strong, successful brands are achieved when the delivered brand experience is

consistent with the brand promise. Customers’ expectations of the brand are primarily

shaped via external branding and previous experiences with the brand. Their lived brand

experience is greatly influenced by employee behaviour during service encounters (Henkel

et al, 2007; Hoogervorst et al, 2007; Xiong et al, 2013). As such, frontline employees’ brand-

aligned behaviours are essential to the long-term success of any brand (Henkel et al, 2007;

King et al, 2012; Pinar et al, 2016; Punjaisri and Wilson, 2007; Xiong et al, 2013) and

ultimately as a source of competitive advantage (Meng and Berger, 2012).

Given the heterogeneous nature of employees, employee behaviour is also inherently

variable, giving rise to inconsistencies in the fulfilment of the brand promise (Rao et al,

1999). Such variability presents a challenge for all brands (whether the organisation’s core

product is a tangible good or an intangible service) who rely on frontline employees to fulfil

the brand promise, in part or in full (Burmann and Zeplin, 2005; Burmann et al, 2009; King

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and Grace, 2009). Customers’ experiences therefore will never be fully consistent with the

brand promise and their expectations of the brand as there will always be variations in

employee behaviour. However, the variation in employee behaviour around brand promise

fulfilment can be reduced to more consistently meet customers’ expectations. Consistent

delivery of the brand promise is dependent on the brand knowledge and capabilities of

frontline employees (Xiong et al, 2013). As such, employees’ understanding of the brand,

and the brand promise, and what this means for their roles and responsibilities to transform

this knowledge into brand-aligned behaviour and meaningful customer encounters is of

great importance to organisations (Vallaster and de Chernatony, 2005; Xiong et al, 2013).

Increasingly, organisations are recognising the importance of communicating the

brand to employees and providing the knowledge required to inform employees’

understanding of the brand promise (King and Grace, 2008; Piehler et al, 2016; Xiong et al,

2013). de Chernatony et al, (2006) argue that to influence employee behaviour, the brand

must be communicated to, understood by, accepted, and internalised by all employees. This

internal brand building process is fundamental to the enactment and fulfilment of the brand

promise and employee clarity about their role in delivering the brand (Piehler et al, 2015).

Brand understanding is defined as “employees’ comprehension of brand-related

information” (Piehler et al, 2016, p. 1580). Thus, employees’ brand understanding is an

essential prerequisite for their brand-aligned behaviour (Piehler et al, 2016; Vallaster and de

Chernatony, 2005). Brand-aligned behaviour is a component of brand citizenship behaviour

(Burmann and Zeplin, 2005), a well-established outcome of internal brand management.

Brand citizenship behaviour refers to employee behaviour that is consistent with the

overarching values and identity of the brand and the brand promise, which strengthens the

brand (Burmann and Zeplin, 2005).

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Despite the acknowledged importance of employee brand understanding, research

investigating the drivers of employees’ internalisation of brand information and knowledge

is scarce. This paper addresses this gap by synthesising key insights from internal branding

and internal marketing with signalling theory (Spence, 1973), namely brand signal channel

quality, brand signaller quality, and brand signal quality, to develop a conceptual model

describing the antecedents of employee brand understanding. Brand signalling reduces

information uncertainty; in this context, for frontline employees who are primarily

responsible for delivering the brand (Erdem and Swait, 1998). In the internal organisational

environment, organisational managers (organisations) transmit brand signals to help

employees make inferences about how to behave in a manner consistent with the intended

brand promise and customers’ expectations (Rao et al, 1999). When employees perceive

brand signals to be clear, credible and consistent, they are able to better internalise and

understand the brand and the brand promise and to establish boundaries around their

behaviour that ensure they fulfil the brand promise intended by the organisation (Erdem

and Swait, 1998; Rao et al, 1999). Such understanding is considered vital for the enactment

of employee brand citizenship behaviour (Pimpakorn and Patterson, 2010).

In developing the conceptual model, this paper is structured as follows: First, the key

principles of signalling theory (i.e. information asymmetry and brand signals) and their

application to the internal, employee-focused context are discussed. Following this, the

influence of brand signal channel quality and brand signaller quality in the organisational

hierarchy are considered. Three elements of brand signal quality (clarity, consistency, and

credibility) are then outlined. Finally, employee brand understanding and its importance to

brand-aligned behaviours is explored. The discussion is synthesised into a new conceptual

model before the implications of this model for managerial practice and future academic

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research are presented.

LITERATURE REVIEW

Information Asymmetry, Signalling Theory and Brand Signals

Signalling theory (Spence, 1973) advocates the use of brand signals to reduce uncertainty

and help stakeholders (i.e. the receivers of brand signals) make inferences about the quality

and value of a brand’s offering. While the term signal has various meanings and is used in a

variety of contexts, this paper aligns with Kirmani and Rao’s (2000) description of a brand

signal as an extrinsic part of the brand offering that transmits information about the quality

and value of the brand’s offering. Since brand signals are extrinsic to the brand, and do not

comprise detailed information about the brand, they can only provide the basis for making

inferences about the brand’s true features (Bloom and Reve, 1990). Brands signals that have

received the most attention within the literature include the brand name, good/service

price, features, warranties, and customer service procedures (Bloom and Reve, 1990;

Chatterjee et al, 2005; Erdem and Swait, 1998).

Organisations typically know more about their brand’s offering than their stakeholders

(i.e. customers, employees, competitors, suppliers). This state is known as information

asymmetry (Erdem and Swait, 1998; Kirmani and Rao, 2000) and creates a form of

uncertainty making it difficult for stakeholders to evaluate the quality of a brand; a

phenomenon described as imperfect information (Nelson, 1970). To date, two main streams

of research have applied signalling theory and brand signals to situations of information

asymmetry. Traditionally, research considers external customers and the use of brand

signals to reduce uncertainty about the quality of tangible goods and intangible services

(Erdem and Swait, 1998; Spence, 1973). More recently, the process of signalling to

6

prospective and current employees to reduce uncertainty about employment offerings has

been considered (Wilden et al, 2010). Both streams of research suggest that brand signals

give comfort to the receivers of brand signals that the company is both willing and able to

fulfil the brand promise (i.e. the promise about good/service quality or employment

conditions) (Erdem and Swait, 1998; Wilden et al, 2010). In this paper, uncertainty is

conceptualised following Nelson (1970), meaning it is difficult for employees to evaluate,

internalise, and enact information about the brand promise and to deliver a consistent

brand experience to customers.

Signalling theory and the use of brand signals can be applied internally within the

organisation to reduce situations of information asymmetry. In this instance, information

asymmetry occurs when an organisation knows more about the quality of tangible goods

and intangible services and the brand promise, than the employees responsible for fulfilling

the brand promise when interacting with customers (Erdem and Swait, 1998; Kirmani and

Rao, 2000). Information asymmetry creates uncertainty and makes it difficult for employees

to evaluate and internalise the quality of information about the brand promise (Nelson,

1970). Further, as Piehler et al, (2016) argue, employees who do not sufficiently understand

the brand will not be able to produce brand aligned behaviours. When employees make

decisions in situations of imperfect information (i.e. uncertainty), their perception of risk

increases which can stimulate the search for additional information in order to close the

perceived information gap, causing employees to incur information search costs (Wilden et

al, 2010). The perceived information gap and associated information search costs reduce

employees’ confidence in their understanding of the brand promise and their specific roles

and responsibilities required to fulfil the brand promise consistent with the brand’s values

as well as customers’ expectations (Erdem and Swait, 1998; Menictas et al, 2011). Signalling

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theory (Spence, 1973) advocates the transmission of brand signals via various channels and

signallers, to reduce uncertainty and help employees more confidently infer appropriate

behaviours that are aligned with the brand, as they internalise and understand the brand

promise and how they are required to fulfil the brand promise through their behaviour (Rao

et al, 1999).

Previous research has established that brand information can take many forms (Baker

et al, 2014; de Chernatony et al. 2006; King and Grace 2008), use a range of channels (Baker

et al, 2014), and the efficacy of the transmitted information is assessed (by employees as

receivers) using a range of criteria (Anderson and Narus, 1990). The choice for transmission

of brand information is also influenced by the intention and context of the information

(Trevino et al, 1987) as well as the matching of the channel to the characteristics of the

message (Sitkin et al, 1992). Early work in this area explored how managers chose channels,

or media, to transmit their information (Sitkin et al, 1992, O'Reilly, 1982, Trevino et al,

1987). Key findings from this work suggested a variety of determinants, including the

carrying capacity of the channel, symbolically and in size, ultimately influenced a decision

makers choice of communication media. Further, Trevino et al, (2000) argue a manager will

select a channel or media due to the characteristic of the information, such as the perceived

ambiguity of message, richness potential, time and distance.

Brand information transmitted in an organisational setting therefore can be

categorised by the characteristics of the brand signal information. Information or media

richness theory suggests that for communication effectiveness, media capacity and message

content needs to be aligned (Daft and Lengal, 1984; 1986). Message characteristics

identified in the literature include complexity, clarity, volume, valence and relevance (Sitkin

et al, 1992). For example, some information is rich, dense and highly complex, meaning that

8

the information contained in the signal is not easily understood, or requires time to

understand and process it (Petty and Cacioppo, 1984). Other information is imbued with

emotion (White, 1992), or has power embedded within the hierarchical structure

(credibility, attractiveness and power) (Pornpitakpan, 2004). This type of information needs

to be recognised as authoritative or as a truth, with the author trusted, known and visible.

Organisations by their nature are social entities (Weick, 1979) and some information is

designed to generate discussion and collaboration, or be transmitted informally, though

informal networks of peers. While other information is designed to reinforce what is already

known, to remind receivers of what has been stated previously. Drawing on the previous

conceptual and empirical message characteristics, this paper proposes within the context of

brand signals, implicit or explicit brand information within a brand signal can be categorised

into six main brand signal categories: complex, governance, co-creation, informal,

reinforcement and symbolic. Table 1 synthesises the concepts introduced earlier and argues

that the type of brand signal (information) will determine the choice of brand signal channel

(to be discussed later in the paper). Table 1 summarises the nature of the brand signal, and

suggests the criteria that the channel satisfies to deliver on the signal.

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Brand Signal Information Category

Criteria for selection of channel Examples

Complex When information is complex, not easily understood and is complicated or intricate by nature.

Organisational policies, standards and procedures

Information about the brand

Governance When information needs to be viewed as powerful and considered “truth”

Communication direct from the CEO or senior management team

Co-Creation When information is designed to bring at least two parties together in order to jointly produce an outcome.

Feedback loops, surveys

Informal When information is less serious and more relaxed

Conversational Social

Reinforcement When information is reinforcing or strengthening in nature

Constructive criticism Reprimands and warnings

Symbolic When information or messages are enacted through behaviour/s

Manager taking an employee out for lunch to acknowledge and celebrate their dedication

Staff achievement awards

Table 1. Brand signal categories

Signalling theory offers potentially significant contributions to brand communication

that gives focus to the internalisation of a brand’s promise. Given that frontline employees

are the interface between the organisation and its external customers, they are primarily

responsible for fulfilling the brand promise. However, as discussed earlier, frontline

employees rarely possess perfect information about the brand promise made to external

customers (Erdem and Swait, 1998). This leads to inconsistencies in their behaviour when

interacting with customers. Thus, examination of the key principles of signalling theory,

namely brand signal channel quality, brand signaller quality and brand signals, as potential

antecedents of employee brand understanding, will provide insights into the development

of employees’ cognitive processes, which ultimately influence their brand-aligned

10

behaviours. Such insights have the potential to guide organisations to reduce information

uncertainty and increase employees’ brand understanding.

Brand Signalling Channels

The importance of employees receiving consistent brand messages over a range of brand

signalling channels to enable them to do fulfil the brand promise is recognised as important

to employee brand understanding (Piehler et al, 2015). Channel characteristics have

important implications both for brand message effectiveness and quality (Piehler et al,

2015), and to meet the needs of both the signal and signaller. Media richness theory (Daft

and Lengel, 1986) describes the characteristics of communication channels and the capacity

of each channel to carry “rich information… with rich information being more capable than

lean informa­tion of reducing equivocality in a message receiver” (Carlson and Zmud, 1999,

p. 154). While brand communication is designed strategically to serve a range of brand

related outcomes, for example, generating awareness and building trust, brand signals by

their very nature are delivered within a competing network of relationships, contexts and

mediums that potentially interfere with the intended brand signals.

Within an internal brand environment, the transmission of a brand signal requires a

brand signaller to select an appropriate channel to send the signal (Connelly et al, 2011). A

signaller therefore makes a number of decisions based on the intended nature of the brand

signal, the intended characteristics of audience, and the capacity and characteristics of the

channel to deliver the signal. The receiver decides how to interpret the signal (Connelly et

al, 2011). The brand signal needs to be appropriate for the characteristics of the channel

selected. As such, brand signals are subject to a range of influencing factors (Chatterjee et

al, 2005) and the channel choice can accentuate the effectiveness of the brand message to

11

be received (Piehler et al, 2015) and ultimately influence how brand signals are interpreted

and translated into understanding of the brand promise.

The choice of channels through which to transmit brand signals within an internal

environment presents a range of challenges for brand communicators. First, while some

brand signals are designed for specific audiences, such as consumers or employees, the

nature of the communication channel may mean that all audiences receive the brand signal

and are potentially affected. Employees’ perceptions of brand-specific information they

receive internally may not align with the brand signals or the brand promise made externally

(Piehler et al, 2015)

Specific brand signals about service quality or characteristics of goods and services

might be communicated to consumers but employees may perceive something different

due to competing brand signals. For example, implicit internal brand signals resulting from a

reduced budget for maintenance of equipment, might contradict external signals of brand

reliability and safety. Similarly, internal brand signals resulting from the withdrawal of

funding for staff training, or poor employment conditions, might contradict external signals

emphasising customer service. Such interference or noise is likely to result in unclear

perceptions of brand signals, which in turn affects employees’ brand understanding and

behaviour towards customers (Piehler et al, 2016; Porricelli et al, 2014). Therefore,

knowledge of 1) what intended brand-specific information has been signalled to employees

by the organisation (refer Table 1), and 2) how employees perceive the brand signals they

receive directly and indirectly via other brand signalling channels is essential to understand

the brand, which directly impacts employee brand-aligned behaviours. Additional challenges

to this occur through the proliferation of brand touchpoints due to technological advances

(Piehler et al, 2015), such as online chat forums and face to face interactions. Achieving

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consistency of the communication message is paramount for success (Barker and Camarata,

1998; Piehler et al, 2015).

Sharma and Kamalanabhan (2012) found consistency in brand message across

channels was a key indicator of satisfaction. Channel characteristics therefore will influence

the form and transmission of the brand signal and how the receiver interprets the

information conveyed within the signal categories. Ruck and Welch (2012) found

organisations emphasised electronic (digital) communication rather than print, but suggest

organisations are still coming to terms with social media.

Contemporary organisations have a range of channels available for brand signals, each

channel featuring a range of attributes that sustain, enhance or diminish the potency of a

brand signal. The most common channels within a corporate environment are written

communication, personal (verbal) communication, non-verbal/symbolic communication and

digital/electronic mediated communication, and represent both overt and more indirect

forms of internal corporate communication (de Chernatony et al, 2006). The characteristics

and attributes of each brand signal channel are summarised below:.

Written communication: Classical approaches to written communication (Weber and

Parsons, 1964) recognise the permanency of written sources in organisations. Written

sources allow the information sent by signallers to be preserved with stability and efficiency,

facilitating the consistency of brand information for all receivers as noted as a key

requirement by Erdem and Swait (1998). The efficiency of providing messages through

written channels allows both complex and simple concepts to be presented, with citable or

referable source authority. Written communication is widely accepted in organisations and

can be adapted for transmission across a range of communication genres (Hargie and

Tourish, 2009). A key advantage of written communication is that is it easily reproduced

13

whereby signal accuracy and consistency is ensured. Further to this, written communication

is trustworthy and more stable over time. The disadvantages of written communication

include limited emotion, limited use of imagery and limited personalisation, as well as a lack

of immediate feedback and clarification if required by the receiver. Examples of written

communication include brand guidelines, magazines, flyers, brochures, letters, memos,

information boards, reports, manuals and contracts.

Personal (verbal) communication: Interpersonal communication is conceived as

communication between two people who have an identifiable relationship (Knapp and Daly,

2011), where the outcome of the interaction has an effect on the other party (Kramer and

Sias, 2014). The nature of the communication between these two people, reflects the

“personal characteristics of the individual as well as their social roles and relationships”

(Hartley, 2002, p. 20). Within an organisational setting, interpersonal communication is

influenced by the style and skills of each communicator (cognition), their relationship, and

the social context or setting. Characteristics of interpersonal communication include the

immediacy of response and counter response, contributing to meaning development. The

perception of emotions through the use of cues is communicated during the interaction.

While interpersonal communication is suited for small groups, it requires all parties to be

engaged (listen and respond) for successful interpersonal communication to occur.

Conditions of framing i.e. salience and selection (Entman, 1993) and the physical

environment (symbolic and noise) are also influential in internal communication processes

(Hartley, 2002). Personal characteristics and skills is a key requirement for the signaller of

personal (verbal) communication and “noise” outside of the signallers control has the

potential to interfere and distort the intended and receiver signal. Examples of

interpersonal communication channels include meetings, briefings, formal and informal

14

conversations for work or personal related outcomes.

Non-verbal /symbolic communication: Non-verbal communication “transcends the

bare elements of the written or spoken word” and may occur as part of a communication

interaction between two people (Gabbott and Hogg, 2000, p. 384). Non-verbal

communication is defined as the meaning communicated by intended or unintended

gestures of the body and space. The key advantage of non-verbal communication is the

ability of the signaller to reinforce the message, or signal, transmitted. Examples of non-

verbal /symbolic communication include voice tone, volume, pitch and pace, use of body

language such as hand gestures, crossing arms or nodding head, facial expressions, and

distance. Characteristics of non-verbal /symbolic communication influence evaluation of the

encounter and the potential for inconsistency with intended meaning (Gabbott and Hogg,

2000).

Digital/electronic communication: Electronic communication describes

communication transferred electronically, or digitally through a computer or other device.

The prevalence of personal word devices and computers equipped to receive electronic

communication (e-communication) allows for rapid dissemination of information regardless

of distance. The efficiency and economy of e-communication provides for brand signals to

be transmitted, received, and responded to immediately. Digital tools provide signallers

with features such as flexibility, simplicity, dissemination and speed. Limitations of digital

included potential for ambiguity or misinterpretation, information overload, channel

proficiency (such as email writing skills), and loss of social cues (Lipiäinen et al, 2014). While

traditional channels were commonly used to communicate internal branding to employees,

digital channels allow for wider dissemination, flexibility and tailoring to meet audience

needs (Sharma and Kamalanabhan, 2012). Digital signals compete against a volume of other

15

information and also require receivers to have access to technological platforms to access

the brand signals.

Signal - Channel selection

In an organisational setting, brand signallers can choose from a range of brand signal

channel categories. As presented in the previous section, each category features

characteristics and attributes that offer advantages or disadvantages (Daft and Lengel,

1986), to sustaining, enhancing or diminishing the potency of a brand signal. This paper

argues that this, in turn, influences a receivers understanding of the brand. Based on the

brand signal channel category characteristics and attributes, Table 2 details which brand

signal channel is either most optimal, optimal and less optimal according to the category of

information transmitted via the signal. If the information transmitted within the brand

signal is considered to be complex and reinforcement information, a signaller should utilise

written communication as their number one preference in terms on brand signal channels in

order to have the greatest impact on the receiver’s, namely the employee’s, brand

understanding. Written communication is the most optimal brand signal channel for

complex information as it allows for complex concepts to be presented with referable

source authority and provides a historical record of information which can be referred to by

receivers at any time (Weber and Parsons, 1964). For brand signals that are classified in the

information category of governance and co-creation, a signaller should utilise personal

(verbal) communication which provides receivers with an immediate and identifiable source

to build trust between signallers and receivers (Knapp and Daly, 2011). For brand signals

classified as informal, signallers should use digital/electronic communication which allows

for rapid dissemination of information. When brand signals transmit symbolic information,

signallers should employ non-verbal/symbolic communication as the most optimal channel

16

to influence brand understating. Symbolic communication allows signallers to reinforce the

information conveyed within the signal and go beyond spoken word (Gabbott and Hogg,

2000).

Brand Signal Channel

Brand Signal Information Category

Written communication

Personal (verbal) communication

Non-verbal/symbolic communication

Digital/electronic communication

Complex Information is complicated or intricate by nature

*** * **

Governance Information is powerful and considered “truth”

** *** *

Co-Creation Information designed to bring at least two parties together

*** * **

Informal Information less serious and more relaxed

** * ***

Reinforcement Information is strengthening

*** ** *

Symbolic Enacting information through behaviour

* ** ***

*** = most optimal channel ** = optimal channel * = less optimal

Table 2. Signal-channel decision matrix

Brand Signallers and Receivers

The primary actors involved in brand signalling are the signaller and the receiver. At the core

of signalling theory are signallers who hold privileged information about the brand and the

brand promise that is not always available to receivers. Signallers transmit brand signals via

17

brand signalling channels to minimise the uncertainty perceived by the receivers. Internal

signallers include the CEO, senior leaders/executives, managers and other staff. External

signallers include competitors, customers, the media, suppliers, wholesalers, distributors,

industry bodies, unions, etc. Receivers are those to whom signallers transmit brand signals

towards. Receivers typically lack compete information about the brand and the brand

promise, and will observe, interpret, and translate brand signals in light of their experience

(Connelly at al, 2011). The receiver will adjust their interpretation of brand signals based on

the history of the signaller and previous interactions (Herbig and Milewicz, 1995). Signallers

have the ability to alter the nature and intensity of the brand signal (Bloom and Reve, 1990)

through their knowledge and position within the organisation. As such, the perceived

quality of the signaller in transmitting brand signals to minimise uncertainty as perceived by

receivers, is conceptualised by the signaller’s communication competence, access,

familiarity and flexibility (Sitkin et al, 1992). The first characteristic is brand signaller

communication competence. That is, the ability of a brand signaller to communicate

successfully and efficiently. Second, brand signaller access is a signaller’s ability to obtain or

retrieve information readily (Rice and Shook, 1998). The third characteristic is brand

signaller familiarity which is defined as the signaller’s close acquaintance with, or knowledge

of, the information they are signalling to receivers, namely employees. And finally, brand

signaller flexibility is described as the signaller’s willingness to be pliable when

communicating with employees who may have various information needs. Overall, a

receiver’s perception of brand signaller quality, as conceptualised by brand signaller

competence, access, familiarity and flexibility, plays a key role in influencing employees’

understanding of the brand.

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In the context of the internal market, while each employee plays an important messenger

role in the organisation (Zerfass and Franke, 2013), the primary signallers are an

organisation’s senior executives and/or managers, and the receivers are frontline

employees. Brand signals aim to reduce uncertainty by informing frontline employees’

understanding of the brand promise and how they are expected to fulfil the brand promise

through their roles and responsibilities (Erdem and Swait, 1998; Erkmen and Hancer, 2015;

Hoogervorst et al, 2004).

Cascading signalling hierarchies

To achieve overall brand success, it is of vital importance that the organisational culture

focuses on satisfying customers’ needs from senior executives down through the

organisational hierarchy to the frontline employee who is primarily responsible for fulfilling

the brand promise during customer interactions (Castro et al, 2005).. Organisational

signalling hierarchies, otherwise known as layers of sequential authority, can arbitrarily be

divided into managerial hierarchies (Reitzig and Maciejovsky, 2015). Such hierarchies are

assumed to operate within the brand signalling environment and information is assumed to

pass in a top-down manner within the organisation. In other words, one hierarchical level

becomes the signaller, sending brand signals to the next hierarchical level which becomes

the receiver (Erdem and Swait, 1998; Erkmen and Hancer, 2015). Although there are various

hierarchical levels within an organisation, for the sake of simplicity and generalisability, this

paper considers three main hierarchical levels; 1) senior executives, 2) managers, and 3)

frontline employees.

Traditional models of communication are founded on a formal transmission

framework whereby a signaller’s brand signal is encoded, transmitted via a brand signal

channel, and then decoded by the receiver (Shannon et al, 1949). This process of

19

communicating the brand promise from senior executives through managers to frontline

employees is commonly referred to as a cascading communication approach (Burmann and

Zeplin, 2005). A key premise of cascading communication is that brand understanding is

determined by the individual’s interpretations of brand signals that have been passed down

from senior levels. For example, senior executives act as signallers who send brand signals

to managers (receivers). Managers interpret these brand signals and then signal them to the

next level in the hierarchy (frontline employees). Frontline employees, as receivers,

interpret these brand signals and use them to inform their behaviour when interacting with

customers. This cascade of the brand promise from executives to all employees, is both

mandatory and essential in circumstances where brand message consistency in important

(Burmann and Zeplin, 2005; Welch and Jackson, 2007). Within the cascading signalling

environment, downward and upward signalling channels of communication operate

whereby signallers and receivers from various hierarchies communicate downward (i.e.

specific job instructions, organisational procedures, performance feedback, etc.) as well as

upward (i.e. information about co-workers, feedback about organisational procedures,

customer feedback, etc.) (Cahn, 1986).

While this logic seems somewhat straightforward, several key assumptions are

acknowledged within this top-down cascade approach. First, it is assumed that all

information contained with received brand signals is correct and in-line with the brand

promise. It is recognised that signallers and receivers experience noise, or distractions,

when signalling and interpreting brand signals, and this noise has the potential to cause

interference with the signalling process. Receivers’ interpretations of brand signals may be

incomplete or faulty, which causes disconnect in their understanding of the brand promise

and consequently, they may be uncertain of their roles and responsibilities in fulfilling the

20

brand promise through their behaviours. Second, a top-down cascading approach is not

necessarily an accurate depiction of reality, as other elements such as feedback loops and

two-way communication processes exist within organisations (Welch and Jackson, 2007).

Notwithstanding these limitations, within the context of this paper, the cascading approach

is a reasonable facsimile of how the intended brand promise is signalled from executives to

frontline employees (Burmann and Zeplin, 2005). Once employees receive brand signals,

they make inferences about the brand promise based on their perceptions of brand signals

(via multiple channels). These inferences may or may not align with the intended brand

promise that has been communicated to customers (Kirmani and Rao, 2000; Nguyen, 2009).

Manager-employee brand communication

Within an internal context, employees typically receive brand signals from various internal

(i.e. CEO, senior leaders/executives, managers, colleagues, etc.) and external (i.e.

competitors, customers, marketing agencies, media, etc.) signallers on a regular basis. While

some of these signallers are transitory and of minimal long-term consequence, others are

longer lasting and more significant and develop into important workplace relationships for

employees (McCroskey and Richmond, 2009). It is widely recognised that the most

important of the longer-term workplace relationships is between a manager and employee

(Cahn, 1986; Kramer, 1995; Masterson et al, 2000; McCroskey and Richmond, 2009; Sluss et

al, 2008; Waldron, 1991; Yrle et al, 2003). Such insight stems from research on workplace

relationships which suggests that the most influential relationship an employee experiences

within the workplace is with their direct manager (Masterson et al, 2000; Sluss et al, 2008).

As such, direct managers are commonly identified as a crucial mechanism in the process of

brand signalling as they are the dominant influence on employees, and thus have more

21

credibility with employees than senior executives (Cahn, 1986; Men, 2014; Zacarro et al,

2001).

The communication between a direct manager and an employee is one of the most

important communication relationships within an organisation (Den Hartog et al, 2013). For

the purpose of this paper, the communication between a manager and employee will be

referred to as manager-employee communication. Manager-employee brand

communication is a known factor in employee satisfaction, job performance and brand-

aligned behaviours (Cahn, 1986; Jablin, 1979; Kramer, 1995). According to Graen and

Scandura (1987) managers are known to differentiate in their treatment of employees. Such

differentiation is accomplished through discrepancies in various behaviours enacted by

managers when signalling to employees. Kramer (1995) suggests that inconsistencies in

manager-employee relationships affect a wide range of factors such an employee turnover,

openness to collaboration, and the overall quality of the manager-employee relationships at

the next level up or down the signalling hierarchy.

Research investigating the communication between organisations, managers, and

employees suggests that communication between a manager and employee occurs more

frequently than communication between the organisation and employee (Karanges et al,

2015; Sluss et al, 2008). In keeping with this logic, the conceptual model (see Figure 1)

specifically focuses on the brand signals employees receive from their direct manager via

various signalling channels. The characteristics of the chosen channel, combined with the

brand signaller’s competences, qualities, and styles that a manager utilises when signalling

to employees can significantly influence employee interpretation of signals and subsequent

understanding of the brand (Men, 2014). In line with signalling theory and the use of brand

signals to transmit brand related information to employees, the choice of brand channel,

22

and the inherent characteristics the brand signallers who are relaying the brand signals, are

considered antecedents of employee brand understanding.

Brand Signal Quality

Erdem and Swait (1998) argue, and as signalling theory (Spence, 1973) suggests, the overall

quality of brand signals is characterised by three essential elements as perceived by the

receiver: brand signal clarity, brand signal credibility, and brand signal consistency (across

time and across channels). When employees perceive brand signals to be clear, credible,

and consistent, they are more likely to be aware and more confident of the brand promise

and their specific roles and responsibilities required to fulfil the brand promise during

interactions with customers (Baek et al, 2010). While several researchers (e.g. Gao et al,

2008; Nguyen, 2009; Spry et al, 2011) conceptualise brand signal quality as a higher order

construct with three related dimensions (brand signal clarity, brand signal credibility, and

brand signal consistency) this research focusses on each of the three dimensions as

independent elements of brand signal quality. By doing so, the model provides a more

nuanced view of the role of brand signalling in communication and understanding of the

brand promise.

Brand signal clarity refers to the receivers’ perceptions of unambiguity within the

information conveyed by the signaller (Nguyen, 2009). Extant research suggests that an

effective signal should be observable and clear so that receivers can unambiguously capture

and understand the signal (Gao et al, 2008). In the context of brand promises

communicated to employees, the clarity of brand signals enables employees to identify the

brand promise and how the organisation expects this brand promise to be fulfilled during

the interaction process between frontline employees and customers (Burmann and Zeplin,

23

2005). Clear brand signals, free from bias, facilitate timely understanding and interpretation

of brand signals. This in turn reduces reaction delays and misinterpretations of the brand

promise (Erdem and Swait, 1998; Heil and Robertson, 1991). Given that employees have

imperfect information; it is essential for organisations to convey clear brand signals. When

employees perceive the information that organisations explicitly and implicitly signal about

the brand promise as transparent, unambiguous, and clear, they are more likely to develop

positive perceptions of the quality of brand signal clarity and are more likely to develop an

understanding of the brand that is consistent with organisational values and intentions as

well as the brand promise.

Brand signal credibility describes whether the information conveyed through brand

signals is truthful, dependable, and reliable (Tirole, 1990). Receivers’ perceptions of brand

signal credibility are encapsulated in their confidence that the brand will deliver its promise

(Hoeffler and Keller, 2002). Given that employees have imperfect information; it is essential

for organisations to convey credible brand signals to employees. When the information that

organisations explicitly and implicitly signal to their employees about the brand promise and

their responsibilities in relaying and fulfilling the brand promise, is perceived by employees

as reliable, trustworthy, and credible, employees are more likely to develop positive

perceptions of brand signal credibility. Thus, employees are more likely to develop an

understanding of the brand promise that is consistent with organisational values and

intentions as well as the brand promise.

Brand signal consistency has both a holistic and a temporal component. The holistic

component of brand signal consistency is the degree to which each relevant brand signal

and their associated marketing activity reflects the intended whole across all signal channels

(Erdem and Swait, 1998). For example, senior executives and managers must ensure that

24

the brand signals they send to employees are consistent with the brand signals sent to other

stakeholders (i.e. customers, shareholders, suppliers, etc.). Further, these brand signals

must be consistent across all signal channels whether they are electronic, print, face-to-face,

or present as an artefact within the organisation’s physical environment. The signal

(message) therefore must be congruent with the channel used to communicate the signal.

For example; emotional triggers are better suited to visual imagery – use of video, music,

images; while more complex and factual messages are better suited to print/written

channels.

The temporal element of brand signal consistency captures the extent to which brand

signals remain consistent over time (Backhaus and Tikoo, 2004; Erdem and Swait, 1998).

Given that employees are exposed to imperfect information; it is essential for organisations

to convey consistent brand signals. When the information that organisations explicitly and

implicitly signal about how employees are to relay and fulfil the brand promise consistently

reflects the organisation across channels and time, employees are more likely to develop

positive perceptions of the quality of brand signal consistency. Therefore, they are likely to

gain understanding of the brand promise that is consistent with organisational values and

intentions as well as the brand promise.

Employee Brand Understanding

In addition to brand signal quality, every frontline employee must understand the brand

promise that has been made to customers and their role in fulfilling the brand promise

during customer interactions (King and Grace, 2012; King and So, 2015; Piehler et al, 2016).

Knowledge of how employees become aware of the brand promise, and translate this

knowledge into meaningful behaviours for quality encounters with customers, is of great

25

importance to organisations (Vallaster and de Chernatony, 2005; Xiong et al, 2013). Piehler

et al,(2016) suggest, when employees perceive that they understand the brand, the brand

promise, and what it means in terms of their roles and responsibilities, their confidence

increases which in turn strengthens their brand-aligned behaviour. As frontline employees

personify the brand to the external customer, inconsistencies resulting from employees

failing to deliver the expected service, will result in unmet expectations, and consequently

poor evaluation of the organisation by the customer (Punjaisri and Wilson, 2007; Xiong et al,

2013).

The concept of brand understanding captures employees’ comprehension of brand-

related information. According to Xiong et al,(2013), brand understanding comprises three

dimensions derived from job characteristics theory (Hackman and Oldham, 1975). The first

dimension, employee perceived brand knowledge, describes employees’ understanding of

the brand and how to fulfil the brand promises made to customers. Second, employee

perceived brand importance, encapsulates employees’ understanding of the importance of

overall brand success. And third, employee perceived brand role relevance, captures

employees’ understanding of the importance of their role in achieving overall brand success

(Xiong et al, 2013). Analogous to customers’ use of subjective brand knowledge to make

purchase decisions (Chen and He, 2015; Keller, 2003; Esch et al, 2006), employees infer how

to enact brand-aligned behaviour from their perceived brand knowledge (Xiong et al, 2013).

In contrast to explicit information (i.e. standard employment procedures) conveyed by

managers to influence employee behaviour, employee brand understanding is more implicit

in nature. As such employee brand understanding requires employees to engage in further

effort to identify and internalise brand-related information communicated by the

organisation (Burmann and Zeplin, 2005; Xiong et al, 2013). King and Grace (2008) argue

26

implicit brand knowledge is more intricate than explicit brand knowledge which often

results in the need for greater consideration to be given to the transfer process between

information sent (via senior leaders and managers) and information received (by managers

and frontline employees). Based on the insights gained from Burmann and Zeplin (2005),

King and Grace (2008), and Xiong et al,(2013), employee brand understanding involves

employees’ knowledge of the brand promise as well as their understanding in relation to

fulfilling the brand promise during interactions with customers.

Xiong et al’s (2013) research on developing brand ambassadors is one of few studies

to consider the concept of brand understanding. Extant literature takes employees’ brand

understanding for granted by assuming that employees’ comprehension of the brand will

ensure they are both attitudinally and behaviourally ready to relay and fulfil the brand

promise. More recently, comprehensive research on various internal brand management

outcomes by King and So (2015), and Piehler et al, (2016), identifies an employee’s brand

understanding as a direct antecedent to brand building and brand citizenship behaviour. The

authors emphasise that when employees exhibit higher brand understanding, they display

higher levels of brand building and brand citizenship behaviour because they know what to

do and how to do it (King and So, 2015; Piehler et al, 2016). Piehler et al, (2016) also note

very few studies focus on the antecedents of employee brand understanding. King and So

(2015) present one of the very few studies to consider antecedents of brand understanding

in their research on enhancing hotel employees’ brand understanding and brand-building

behaviour. Results of their study indicate that internal brand-oriented support (i.e. the

organisational environment contributing to employees’ brand understanding), brand-

oriented recruitment (i.e. hiring employees with values congruent with the brand) and

brand-oriented training (i.e. providing employees with information about their individual

27

role and how it contributes to the brand promise) have a significant influence on employees’

brand understanding which in turn influences their pro-brand behaviours (King and So,

2015). Overall, the research suggests that brand-oriented recruitment has a more

immediate impact on employee behaviour than brand-oriented training and brand-oriented

support.

Conceptual Model

The proposed relationships represented within the conceptual model infer that when

employees perceive higher brand signaller quality, brand signal quality, and brand signal

channel quality, they become aware and more confident of the brand promise and their

specific roles and responsibilities required to fulfil the brand promise during interactions

with customers (Hyun-Baek and Whitehill-King, 2011; Erdem and Swait, 1998). These three

conceptual relationships are explained in further detail below.

The role of the brand signaller is to transmit brand signals and minimise uncertainty

as perceived by receivers, namely employees. Employees, who typically lack complete

information about the brand, the brand promise, and the requirements to deliver the brand

when interacting with customers, will observe interpret and translate brand signals

according to their perceptions of their past and previous interactions with brand signallers

(Herbig and Milewicz, 1995). Therefore, perceived brand signaller quality, as conceptualised

by the signaller’s communication competence (signallers’ ability to communicate

successfully and efficiently), access (signaller’s ability to obtain or retrieve information

readily), familiarity (signaller’s close acquaintance with, or knowledge of, the information

they are signalling to receivers, namely employees), and flexibility (signaller’s willingness to

28

be pliable when communicating with employees who may have various information needs)

play a key role in influencing employees’ understanding of the brand.

Brand signal quality, as conceptualised by three essential elements, brand signal

clarity, brand signal credibility, and brand signal consistency, is equally as important when

realising employee brand understanding. When employees perceive brand signals to be

clear (unambiguous), credible (truthful and dependable), and consistent (across time and

channels), they are more likely to become aware of the brand and will be more confident of

the brand promise and their role enacting this promise when interacting with customers

(Baek et al, 2010).

Finally, employees’ perceptions of the form and transmission of brand signalling

channels used to communicate brand signals has the potential to significantly increase their

understanding of the brand promise. Brand signal channel selection and message content

(brand signal) is vital to an employee’s relationship with their organisation (Ruck and Welch,

2012). Ruck and Welch (2012) identified that when these two components of

communication coincide, the employee is more likely to understand and live the business

strategy, values and goals of the organisation, suggesting that their understanding of the

brand is influenced. This understanding then in turn, enables frontline employees to

develop brand knowledge that is consistent with the organisation and the brand promise

made to customers. As detailed in the signal-channel decision matrix (Table 2), certain

brand signalling channels are more effective (i.e. most optimal) in building brand

understanding as other channels depending of the category of information transmitted

within the brand signal.

While the organisation itself is the primary brand when providing an intangible

service, the good becomes the primary brand when organisations provide physical goods.

29

Irrespective of whether an organisation promises to deliver an intangible service or a

physical good, the fulfilment of the brand promise always requires an element of employee-

customer interaction (Brodie, 2009; Erkmen and Hancer, 2015). For example, Footlocker

Australia, a leading provider of athletically inspired footwear, promises to deliver a physical

product. However, within their brand promise, Footlocker (2017) states they are ‘serious

about their passion and enthusiasm for shoes’. This brand promise says to customers that

Footlocker will deliver goods with passion and enthusiasm. On the other hand, Westpac,

one of Australia’s leading banks, promises to deliver both a tangible goods as well as an

intangible services. This is illustrated within Westpac’s (2017) brand promise which says

they endeavour to ‘provide superior returns for shareholders, build deep and enduring

customer relationships, be a leader in the community and a place where the best people

want to work’. This brand promise articulates to current and potential customers that

Westpac will not only deliver superior returns on their investments, but imply their excellent

staff will establish and maintain meaningful relationships with all customers.

The scope of the conceptual model includes the development of employees’

understanding about what goods/services customers are to receive (i.e. athletically inspired

shoes and returns on investments) as well as how customers are to receive goods/services

when interacting with a brand (i.e. passionate, and enthusiastic employees building

favourable relationships with customers) (Grönroos, 1995, 1997). Therefore, the conceptual

model (see Figure 1) is relevant not only to service brands, but all brands who employ

frontline staff who must gain understanding of the brand promise and their individual roles

and responsibilities required to consistently deliver the brand promise when interacting

with customers.

[Insert Figure 1 here]

30

Brand signalling model: Antecedents of employee brand understanding

DISCUSSION

Brand signals and brand signalling offer important contributions to understanding how

employees understand their organisation’s brand promise and the role they play in fulfilling

the promise. The proposed brand signalling model (see Figure 1) conceptualises the

antecedents of employee brand understanding through enhancing internal brand

management practices in the form of brand signalling. The need for improved internal brand

management practices in all organisations originates from customers (King and Grace,

2009). While customers’ understanding and expectations of the brand are largely informed

through external communication, marketing, and advertising efforts, their actual experience

with the brand is what shapes their perceptions. A customer’s perception of their actual

experience ultimately leads to their satisfaction with, and loyalty to the brand (King and

Grace, 2012; Miles and Mangold, 2004). Central to this very process are frontline employees

(King et al, 2012; Pinar et al, 2016; Punjaisri and Wilson, 2007; Xiong et al, 2013).

Just as organisations cannot expect to have all customers familiar with their role in the

service encounter, organisations cannot expect all employees to be familiar with their

specific role (King and Grace, 2009). Therefore, from an internal employee perspective,

brand signals help to bridge the employee knowledge gap, and in doing so, align customer

brand expectations and the brand promise with employee behaviour (King and Grace,

2009). It is from this perspective that Piehler et al, (2016) assert that through the

internalisation of the brand and the brand promise, frontline employees are better

31

equipped to fulfil the brand promise when interacting with customers. This is because the

desired brand values, practices, and behaviours are clarified and defined, providing clear,

credible and consistent direction for all organisational efforts (Burmann and Zeplin, 2005;

Erdem and Swait, 1998; Xiong et al, 2013). Without such brand understanding, the ability

and willingness for employees to enact brand citizenship behaviour that aligns with

organisational values and the brand promise is doubtful, and will most likely result in

inconsistent service delivery. Mapping the hierarchy of brand signals within the internal

brand communication environment (the organisation) contributes to understanding how to

reduce employee brand uncertainty and support employees to internalise, understand, and

fulfil the brand promise through their behaviour during customer interactions.

Within the organisational context there are various signallers responsible for focusing

on the importance of brand truth and how this truth is to be packaged to reflect the

different settings, channels, and pressures on the brand (for example, workplace business,

unit context, individual priorities, organisational culture). For practitioners this means

understanding that there are influences which require them to identify and understand the

way they, as signallers, impact brand signals. Therefore, by recognising that there are

potential influences on brand signals within the organisational context, managers need to

map how these signals play out and contribute to reducing employee brand uncertainty

(Erdem and Swait, 1998). As such, future research is required to provide further guidance

for managers to ensure clear, credible, and consistent communication is delivered to

employees under the circumstance of various signallers utilising various signal channels.

A number of limitations exist in the conceptualisation of the internal, organisational

hierarchy that this model is set. First, the model does not account for additional noise that

may be present in the brand signalling hierarchy. Employees may also misinterpret the

32

brand promise, even if the signals they receive are clear, consistent, and credible. Further

primary research is needed to explore these assumptions. In addition, the signalling

hierarchy is represented as a linear model which adopts a cascading communication

approach to the relaying of brand signals which starts at the top of the organisation and

passes information down through the organisational hierarchy to frontline employees

(Burmann and Zeplin, 2005). While the authors recognise this as a simplistic representation

of internal brand signalling in an organisational context, employees will still behave based

on their perceptions of the ‘truth’ or intended brand promise regardless of multiple streams

of brand communication. Therefore, this research contributes to the paucity of research to

date which has explored what employees are looking for in the internal communication

process from the employee’s perspective (Ruck and Welch, 2012). Further research is

needed however, to explore the other direct communication paths to frontline employees

such as through central communication, lateral internal communication, or even through

external marketing communication (Burmann and Zeplin, 2005). Future research could also

contribute to knowledge by addressing the wider engagement of members of the

organisational hierarchy. Internal communication can be undermined within the hierarchy

due to senior managers’ lack of commitment to organisational values, and investigation of

this as well as the role of employee voice in the hierarchy allows transparency and

immediacy across levels of the organisation (Ruck and Welch, 2012).

In conclusion, the ability to influence employee brand understanding enables such

accountability for managers responsible for communicating the brand promise to frontline

employees. The conceptualisation also provides a means to understand the determinants of

employee brand understanding and in doing so, seeks to expand on signalling theory within

an internal, employee-focused context.

33

34

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Figure 1.

Brand signalling model: Antecedents of employee brand understanding

Brand Signaller Quality

Brand Signaller Competence

Brand Signaller Access

Brand Signaller Familiarity

Brand Signaller Flexibility

Brand Signal Quality

Employee Brand

Understanding

Brand Signal Clarity

Brand Signal Credibility

Brand Signal Consistency

Brand Signal Channel Quality