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European Journal of Marketing

Core value‐based corporate brand building


Mats Urde
Article information:
To cite this document:
Mats Urde, (2003),"Core value#based corporate brand building", European Journal of Marketing, Vol. 37
Iss 7/8 pp. 1017 - 1040
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http://dx.doi.org/10.1108/03090560310477645
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John M.T. Balmer, Stephen A. Greyser, Mats Urde, (2009),"Uncovering the corporate brand's core values",
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John M.T. Balmer, Fiona Harris, Leslie de Chernatony, (2001),"Corporate branding and corporate brand
performance", European Journal of Marketing, Vol. 35 Iss 3/4 pp. 441-456
Simon Knox, David Bickerton, (2003),"The six conventions of corporate branding", European Journal of
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Corporate brand
Core value-based corporate building
brand building
Mats Urde
Head of Lund Brand Management Research Programme, 1017
Institute of Economic Research, Lund University,
Lund, Sweden Received January 2001
Revised July 2001,
December 2001
Keywords Values, Corporate identity, Brands, Brand identity
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Abstract The aim of this article is to introduce a conceptual framework for a corporate brand
building process based on core values. The nature, role, and function of core values are considered
a central part of the value foundation of a corporate brand. In line with this reasoning, a
distinction is also made between three groups of values: organisational values, core values, and
added values. This article is based on research into the brand building efforts of more than 50
major companies over a period of ten years. The Volvo case is used as an illustration and places
special emphasis on internal processes. The role of the core values in the ten steps of the framework
is explored and illustrated. The work is based on first-hand experiences, interviews, and unique
internal strategy documents from Volvo. The discussion defines core values as overarching
concepts that summarise the identity of the corporate brand and as guiding lights for the brand
building process. Another conclusion drawn from the article is that core values are vital for
continuity, consistency and credibility in a value-creating process. The theoretical and practical
implications of using core values as a unifying common thread are discussed in relation to the
paradigm of brand orientation.

Introduction
Imagine this scenario: in order to better understand their company’s corporate
brand and brand-building process, the board of directors asks four members of
their company’s senior management to make presentations about the
company’s values. The CEO, who is the first to speak, highlights the
company credo; he is followed by the human resources manager, who stresses
the significance the organisation’s internal basic values and principles. The
brand manager then gives an overview of the brand values, and finally the
marketing manager summarises the brand essence from a communication
perspective. For many companies this would probably be a nightmare – no
overall clarity, little apparent consistency and a hotchpotch of terminology.
The purpose of this somewhat contrived introduction is to underline
something that is all too often ignored or forgotten, that is that the
understanding, use and implementation of a value foundation for a corporate
brand is often inadequate and elusive.
One reason is the confusion of terms that are used to describe and identify European Journal of Marketing
the various values that help create the identity of a corporate brand. Far too Vol. 37 No. 7/8, 2003
pp. 1017-1040
q MCB UP Limited
0309-0566
This article has benefited greatly from suggestions made by the two anonymous reviewers. DOI 10.1108/03090560310477645
EJM often there is a lack of structure, there is no obvious thread that links the
37,7/8 processes of protecting, building and developing the corporate brand. And all
too frequently, the role and function of the various values are not clearly set out
and ill defined.
The search for the central core of the brand has engaged and fascinated
numerous researchers and experts. As so many organisations and companies
1018 flounder at this stage of the brand building process, the search is well justified.
It is therefore necessary to provide an overview of how values are treated in the
literature. One way is to look at values from three viewpoints:
(1) values that are related to the organisation;
(2) values that summarise the brand; and
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(3) values as they are experienced by customers.

Values that are related to the organisation


Harmon (1996) and Aaker and Joachimstahler (2000) write in terms of
organisational values and corporate values. Gad (2001) describes corporate
values quite simply as “rules of life”. Kunde (2000) goes one step further with
the expression corporate religion: “. . . the set of values that unites the
organisation around a mission and vision” (p. 111). Credo is a further
expression for an organisation’s values (Ind, 2001; Osborne, 1991 in reference to
The Johnson & Johnson Company Credo). Collins and Porras (1998) call an
organisation’s values core values:
. . . the organisation’s essential and enduring tenets – a small set of timeless guiding
principles that require no external justification; they have intrinsic value and importance to
those inside the organisation (p. 222).
Although this is a good definition, core values are given another definition in
this article. Knox et al. (2000) use the term unique organisation value
proposition in relation to the core processes of the organisation. Organisational
values are expressed in other contexts as well, for example Jensen (1999) calls it
storytelling, and Edvinsson and Malone (1997) refer to it as a component of
intellectual capital.

Values that sum up the brand


Brand essence is a term that some organisations have worked with for many
years; the Ted Bates advertising agency is a good example. The objective is to
define and describe the innermost core of a brand. The term brand essence is
used and expanded on by many authors. Aaker and Joachimsthaler (2000, p. 45),
for example, talk about brand essence as part of identity: “The brand essence
can be viewed as the glue that holds the core identity elements together. . .”
Macrae (1996) investigates the relation between brand essence and
value-adding. Upshaw (1995, p. 25) also sees the brand essence as an inner
value: “. . . the core of the core – the brand essence”. Keller (1999) uses the term
brand mantras: “. . . are short three to five word phrases that capture the Corporate brand
irrefutable essence or spirit of the brand positioning.” Randazzo (1993) likens, building
in principle, brand essence and core value, and elects to speak of the brand soul:
“The brand’s soul is its spiritual center, the core value(s) that defines the brand
and permeates all other aspects of the brand” (Randazzo 1993, p. 17). Kapferer
(1992) uses kernel in his reasoning about the core of the brand. De Chernatony
(1999) develops and creates an interesting distinction between core values and
1019
peripheral values. Other more or less adjacent terms are, for example, brand
code (Gad, 2001), meta value (Linn, 1990), value words (Ind, 2001, 1997), core
desire (Mark and Pearson, 2001), and themes (Schmitt and Simonson, 1997).
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Values as experienced by the customer


McCracken (1993) states that: “Brands have value, it turns out, because they
add value.” The discussion in de Chernatony et al. (2000) about added value
provides a good overview and specifically demonstrates the lack of
terminology consensus. JWT, the advertising agency, argues that added
values include “value proposition” and “functional” and “emotional
discriminators”. “Customer value” is the term that Knox and Maklan (1998)
use to express what the customer is prepared to exchange for a brand. Added
value is also used in other contexts: Itami and Roehl (1987) use “added value” to
explain durable competitive advantages from a strategic perspective. When
Jones and Morgan (1994) speak of “adding value”, they are talking about the
process of developing brands.
Each of these contributions is of interest and value in its own right. The
purpose of the overview is to underline the need for an overall structure and
suggest a model that can be used for a discussion that will lead to the
establishment of a corporate brand value foundation. There are both theoretical
and practical advantages to dividing values into the three areas described
(Figure 1); it becomes easier to see which are the organisational values, which
are the core values and which are the added values. When viewed together,
they form the value foundation of a corporate brand (Urde, 1997). In parallel
with this, the identity can also be divided into these three levels; that is the
identity of the organisation, the identity of the brand and the identity of the
customer. The value creating process is brought about by the interaction
between these three levels, as illustrated in Figure 1. The organisational values
answer, in principle, the questions of what we, as an organisation stand for and
what makes us who we are. These internal values are an important point of
departure for the core values, which in turn summarise the brand’s identity.
The most important task of the core value is to be the guiding light of the brand
building process. If they are to fulfil their role and function, core values must be
built into the product, expressed in behaviour and reflect the feel of
communication. The exchange and the advantages that a customer associates
with a brand are to be regarded as added values, i.e. the difference between a
EJM
37,7/8

1020
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Figure 1.
There is a continuous
interaction between
value and identity at
three levels

brand and a commodity. An added value may be functional, emotional and/or


symbolic. Added values are closely related to core values and organisational
values. This means that added values constitute an important link between the
internal and external process. The act of interpreting and reinterpreting affect
the image and identity of the corporate brand (Christiansen and Askegaard,
2001).
The purpose of this article is to introduce a conceptual framework for core
value-based corporate brand building, to illustrate and, at the same time,
explore the nature, role and function of core values. To do this I have focused on
the internal processes and used Volvo as an illustration.
One of the basic arguments put forward in this article is that core values
affect an organisation at every level and at all times. The difference between
having a given number of values within a company that one says one stands
for, and consciously working with clearly defined core values that are the
guiding principle of the brand building process, should not be underestimated.
In short, the development of core values is synonymous with the development
of the brand.
By definition, core values affect leadership, strategy, organisation, product
development, communications etc. When an organisation grows from a
position in which the mission, vision and organisational values are brought
together in the form of core values, a vital step on the road towards high-level
brand orientation has been taken (Urde, 1994, 1997, 1999; Hankinson, 2000).
This means that the corporate brand and its core values are, in almost every Corporate brand
respect, the hub around which the company’s strategy and business revolve building
(Louro and Cunha (2001)) on brand management paradigms). At the extreme,
this is an attitude that presupposes brand management competence that aims
to develop the brand as a resource and strategic competitive advantage.
1021
Methodology
Throughout my research I have kept asking why some organisations and
companies are more successful than others when it comes to brand building.
Based on more than ten years research into the brand building processes of 50
major organisations and companies, I have come to the conclusion that the
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mind set – an organisation’s approach to brands – is the decisive factor (Urde,


1997). My experience, which has been gleaned from exhaustive field studies in
such companies as Ericsson, DuPont, Nestlé, Tetra Pak, Pharmacia and Volvo,
has stimulated my interest in value systems and core values.
I have chosen to illustrate the discussions in this article with Volvo as
corporate brand and company prior to the acquisition of Volvo Car by the Ford
Motor Company on 29 January 1999[1]. This temporal delimitation has made it
possible to present unique material that was earlier regarded as either sensitive
or confidential. My experiences from Volvo have played a very special role in
my work with core values. It was while working with Volvo that I first
discovered a number of important links and relationships between a value
system and brand orientation.
My first contact with Volvo was made during a project that involved
analysing and evaluating brand management and brand building at AB Volvo
in 1995. My role was at that time, as researcher and consultant, to be part of an
internal working group. The group completed an international benchmarking
study and interviewed approximately 40 managers at the corporate level
within the truck, bus, construction equipment, aircraft engine, marine engine,
automobile, and after sales divisions (Björholt et al., 1995).
Since that first contact I have continued to work with Volvo as a formal and
informal advisor and sparring partner. My understanding of the workings of
the company has been enhanced by an additional 20 interviews, during my
research, with managers representing Volvo and its partners. The managerial
quotes in this article have been taken from interview transcripts I made with
Volvo and its collaborating partners between 1995 and 2001.
My earlier experiences from Volvo have allowed me to observe its
brand-building strategy at close quarter over a period of time. During this
period, my aim has been to always have an open mind. As time passed, the
question of defining the real core of a brand building system became more
apparent and more important. The emerging knowledge from the case drove
and guided my research process. My methodology was in the initial stage
inspired by “grounded theory” (Glaser and Strauss, 1967; Glaser, 1978; Strauss
EJM and Corbin, 1989). Later research required that I carried out new case studies
37,7/8 and applied different qualitative techniques, such as triangulation, to verify
and further develop the conceptual framework for core value-based corporate
brand building (Silverman, 1993; Yin, 1989, 1993). I adhere largely to a
symbolic interactionist perspective (Berger and Luckmann, 1966; Solomon,
1983; Guiraud, 1992; Silverman, 1993), which, among other things, means that I
1022 see brands as symbols and that an organisation’s way of approaching brands
or value creation is a decisive factor.

A brand building process based on core values


The development of a brand as a resource and a strategic instrument of
competition requires that it engages and represents a value for both the
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organisation and customers in target group or groups (Melin, 1997; Urde, 1997).
Ideally, a brand – as a sustainable competitive advantage – should be unique
and difficult for competitors to imitate (e.g. Barney, 1991, 1997; Hall, 1992;
Grant, 1995). The value-creating processes take place in parallel. These are
internally, i.e. within the organisation, and externally, i.e. in the awareness of
customers (Figure 2); together they generate corporate brand equity. Keller
(2000, p. 115) defines corporate brand equity:
. . . as the differential response by consumers, customers, employees, other firms, or any
relevant constituency to the words, actions, communications, products or services provided
by an identified corporate entity.
In this article, we are primarily discussing the internal value-creating process;
special emphasis is placed on a company with a corporate brand. The reason
why the external process is also presented is to provide an overview to help the
reader to relate added values to core values, and vice versa.
The internal brand building process (left column, Figure 2) is primarily used
to describe the relationship between the organisation and the brand (see
Figure 1). The objective of this internal process is ultimately to get the
organisation to live its brands (Balmer and Wilkinson, 1991; Balmer, 2001;
Harris and de Chernatony, 2001; Urde, 1994, 1999; Ind, 2001). This is described
in the model as internal brand identity, i.e. the organisations own
understanding of the brand and its commitment to it. The value base
includes the main assignment, i.e. the vision, the organisational values and the
core values. The establishment of this value base within an organisation is a
decisive factor in the production of an internal brand identity. The
organisation’s relationship with the brand will also affect the total internal
relationship to the brand and vice versa.
The external brand building process (right column, Figure 2) is primarily
concerned with relations and interactions between the brand and the customer
(see Figure 1). The objective of this external process is ultimately to create
value and relationships, with the customer’s identity as the basis. To achieve a
strong brand relationship with the customer, it is necessary for there to be an
Corporate brand
building

1023
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Figure 2.
Internal and external
core value-based brand
building process based
on experiences at Volvo
and a series of other
companies

interest in the product and for the choice of brand to be regarded as important,
i.e. there must be brand sensitivity (Kapferer and Laurent, 1992). This is
followed by a need to create brand awareness and positive brand associations
(Aaker, 1991; Melin and Urde, 1991). The added values that the customer
experiences can be functionally, emotionally, and/or symbolically based (de
Chernatony and MacDonald, 1998). If the brand’s image is attractive to the
customer’s own self-image (Higgins, 1987) – real, ideal, or normative – the
basis has been created for a relationship between the brand and the customer.
This is, in turn, the basis for a relationship that can develop into brand loyalty
(Grönroos, 1995).
The framework builds on the idea that a brand’s identity is developed as a
continual and ongoing interaction between the identity of the organisation and
the customer. In this way, the organisation’s values, overall mission, and vision
of what is to be achieved – beyond generating profits – obtain their true
meaning. Brands can therefore be seen as symbols of an organisation’s efforts
and ambitions.
EJM Core value-based brand building – the case of Volvo
37,7/8 In order to illustrate the role of the core values in an internal brand building
process, the case of Volvo is analysed and discussed based on the ten steps in
the framework (Figure 2). The point of departure is the overall task or mission.

1024 The mission – commitment to the overarching task


A brand mission can be described as the brand’s fundamental reason for
existence (e.g. Levitt, 1960; Drucker, 1973; Campbell and Yeung, 1991; Collins
and Porras, 1998). Furthermore, it is often an important means for gaining
internal and external commitment to the cause. The feeling that one is a
participant in an important endeavour creates the basis for true commitment
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(Senge, 1992; Balmer, 1995).


For established companies, the quest for a mission statement often becomes
an odyssey in the organisation’s history and origins. This was also the case at
Volvo, where it was possible to go back to the thoughts of the founders – Assar
Gabrielsson and Gustaf Larson – about safety in the so-called sales manual
from the beginning of the 1930s, as quoted the Volvo brand management policy
(AB Volvo, 1997, p. 7):
An automobile is made by and for people. The basic principle for all manufacturing is and
must remain: safety . . . On this point, we are proud to be conservative. And even in the future
this will remain our guiding light.
This excerpt from the sales manual can be seen as both an early expression of
Volvo’s mission – i.e. to develop safer cars and other vehicles – and as the
embryo of a central core value. This historical foundation of an organisation’s
efforts in the area of safety has among other things contributed to the
legitimacy of the concept within the organisation. In the formulation of Volvo’s
mission, the concept of safety reappears, this time together with the core values
quality and concern for the environment: “Volvo creates value by providing
transportation related products and services with superior quality, safety and
environmental care to demanding customers in selected segments” (AB Volvo,
1998, p. 6).
If the mission is to function as a basis for the organisation’s brand building,
it must have a true foundation in the organisation’s value base. Nevertheless,
one problem is that the mission is often seen as standing alone, without ties to
the organisation’s daily operations, it therefore becomes harder to use. Within a
company that competes using its corporate brand, the mission is in contrast an
unmistakable driving force and expression of the organisation’s overall goals.
It thereby becomes a part of the brand’s identity. By integrating the core values
with the mission statement, the core values naturally assume a prominent role.
Core values shall follow the example of the mission and be future-oriented and,
in principle, never be fully satisfied. If they are static they will only be
descriptions and thereby lose an important quality.
The vision – inspiration for goals and a stimulus to development Corporate brand
In a company like Volvo, the brand vision functions as a projection of the brand building
into the future linked to the mission. It gives a vivid description of what an
organisation wishes to accomplish with the brand over the next few years
(Olins, 1989; Collins and Porras, 1998). Ideally, a brand vision is a source of
inspiration and challenge for the organisation.
Volvo’s brand strategy statement from 1997 provides a picture of an
1025
overarching vision. Volvo’s three core values of safety, quality, and concern for
the environment recur and are clearly linked to the vision:
Based on consumer-perceived quality and achievements, Volvo will distinctly, decisively and
consistently sustain and develop its brand position as a recognized leader in safety and be
ranked as a leader in terms of environmental care among the world’s top producers of
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automotive and transport products, equipment and systems (AB Volvo, 1997, p. 12).
The core values can contribute to continuity and far-sightedness by also being
a part of the corporate vision.

Organisational values – the foundation of the core values


The arrangement of an organisation’s more or less expressed common values,
supporting ideas, positions, habits, and norms converge to give a corporate
culture its character. The organisational values answer in principle the
questions of what we as an organisation stand for and what it is that makes us
who we are. It is, consequently, the values that are internally regarded as
important within an organisation, but this is not necessarily the case for the
outside world (Berg and Gagliardi, 1985; Knox et al., 2000). For example, this
form of value can often be attributed to the organisation’s origin, founder(s),
dramatic events, leader(s), or other prominent persons.
At Volvo, organisational values are intimately related to the mission and
vision, and they also provide a basis for the core values. Within the company,
people speak of “Volvo-ness” and “The Volvo way”, which are expressions that
stand for the internal values, basic traits of the corporate culture, and guiding
principles. The corporate culture at Volvo is characterised by the
organisational values of, for example, care for people, responsibility,
integrity, and honesty. According to Leif Ahlberg, VP for brand
management at AB Volvo, the organisational values are, to a large extent,
ethical questions that are not independent of the core values. The
organisational values can rather be said to constitute a foundation that
provides the core values with an amplifying platform.
An insight illustrated by Volvo is that the organisational values can, in
principle, be divided into and related to three areas:
(1) product development;
(2) the way of doing business; and
(3) the feel of the organisation.
EJM The “way of developing products” often reflects what is internally considered to
37,7/8 be a product or service one can be proud of, that is, values that can often be
attributed to the form and function of the product or service. At Volvo, for
example, lively discussions are often conducted about what is “Volvo-ness” vs
what is not. The introduction of a convertible and Volvo’s involvement in racing
are examples of subjects that attracted much internal debate, partly because they
1026 were not seen as agreeing with the core values. “The way of doing business”,
which can be described, as the behaviour that the members of the organisation
feel should distinguish the organisation, in turn reflects the corporate culture and
its relationships with, for instance, customers. These organisational values often
create a basis for the emotional dimension of the brand. Finally, the “feel of the
organisation” reflects the overarching purpose and what people want to achieve.
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These organisational values are often symbolic in character.


The division of the organisational values into three areas also makes it
possible to identify three core values. This structure and logic means that the
core values can summarise the functional, emotional, and symbolic dimensions
of the brand and its identity. By working with three core values of different
character and function, the basis is created for a credible and well-anchored
brand identity that has depth and breadth.

Core values – the common thread of the brand building process


Core values cannot be invented, but have to be earned and proved over and over again – and
they must never be jeopardised. In order to endure and achieve business success, every
corporation must have a sound set of beliefs or core values, which must always come before
policies, practices, and goals (AB Volvo, 1997, p. 14).

Core values can be said to fulfil a double function (see Figure 1), as illustrated
by the Volvo case. First, the organisational values are translated into the core
values that guide the organisation’s efforts. Second, the core values are
translated into customer utility value or added value for various target groups.
One of the challenges of implementing core values is that they can be
interpreted in different ways. In the Volvo brand statement, with the aim of
providing a more unified picture of the core values, the brand statement
authors have supplemented the text with short clarifying comments (Figure 3).
This statement may be seen as a summary of the company’s corporate brand
strategy, and establishes a number of principles.
The three core values that the Volvo’s brand statement is based on are
common across the corporation. How they are communicated can vary
depending on the products, target groups, and markets. The goal, however, is for
the three core values to create a common platform for the Volvo corporate brand.
The core value of quality is described as a part of Volvo’s corporate culture
in the brand statement. According to Leif Ahlberg, VP of brand management
for the Volvo Group, “quality is an attitude.” Despite the fact that quality is in
principle a prerequisite for competition, and thus as such not differentiating,
Corporate brand
building

1027
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Figure 3.
The Volvo brand
statement is today in
principle unchanged,
aside from the new
corporate roles and
division of brands
between AB Volvo and
Volvo as one of the
brands under the Ford
Motor Company
EJM Ahlberg emphasises that it is Volvo’s interpretation of quality that makes the
37,7/8 concept unique and distinguishing. Björn Jutendahl, head of market
communication for Volvo Car, argues that quality not only relates to the
product, but also to relations and communication. Volvo’s goal is to have “at
least as good quality, in a broad sense, as the main competitors”.
Safety is Volvo’s primary and most differentiating core value. The goal is for
1028 Volvo to be the world leader in terms of safety in both “construction and
communication”, says Bengt Junemo, a project manager at Volvo Car. At Volvo,
efforts are focused on making safety thinking a natural part of all of the
company’s processes and philosophy. The concept of safety has, however, over
time been given a deeper and broader significance. It has been broadened from
safe products to include personal safety, safety for all passengers, safety for
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others in the traffic environment and safety in relation to the environment. In this
way, the core value of safety has become more intimately related to, for example,
the organisational value of care for people, which in turn is a precondition for
being able to speak about concern for the environment with credibility.
The core value of “concern for the environment” has been disputed within
Volvo, since the products that the company manufactures and markets
undeniably have a negative environmental impact. Within the organisation, it
has, however, been reasoned that Volvo’s commitment and actual track record
in the area of environment qualifies “concern for the environment” as a core
value, according to Sven-Åke Ståhl, global marketing, Volvo Car. This core
value is not yet clearly associated with Volvo by customers, but in its own
circles it is truly established. This situation illustrates how core values can be
an expression for an intention and a part of a desired future identity.

Brand architecture – orchestration of roles and relationships based on core


values
The choice of brand architecture is decisive for how a company organises and
uses its brands. It affects among other things the number of brands, types of
brands, the brands’ roles, and their internal relationships (e.g. Doyle, 1990;
Melin and Urde, 1991; Kapferer, 1992; Aaker and Joachimstahler, 2000). There
is, however, an important underlying relationship between core values and
identity that affects the options and the potential that a given brand
architecture provides. To illustrate the link between core values and corporate
identity, examples from various companies are included in Figure 4. In
principle, it is possible to speak of four basic brand architectures:
(1) corporate brand;
(2) product brands;
(3) corporate and product brands; and
(4) product brands and corporate brand.
Corporate brand
building

1029
Figure 4.
Four fundamental brand
architectures with
different roles for the
corporate brand. The
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core values and identity


affect the selection of
architecture, and
vice-versa

In Volvo’s corporate brand architecture the core values are shared by the
different products, and there is an overall brand identity. In practice, Volvo’s
corporate brand architecture meant that five different product companies could
aim at different target groups under widely varying market conditions. The
core values therefore played a decisive role in co-ordinating the brand building
process. One way of describing the logic of the brand building process at Volvo
is to create a distinction between two levels: corporate brand and product brand
(see Figure 5). These two levels are linked to the three core values, and thus
constitute the basis for corporate brand building and product brand building.
The role of the corporate brand in Volvo’s overall brand architecture is to
give credibility, in, for example, communications with government, the
financial sector, the labour market, and society in general. The individual
product companies contribute to the whole by associating the common brand
with the core values and by living up to and preferably exceeding expectations.
According to the framework, this should take place within the scope of the
corporate core values.

Figure 5.
Core-value framework
linking a corporate brand
to product brands
EJM The framework gives, at the same time, the individual product companies
37,7/8 opportunities to market their products to their customers in different markets.
To increase flexibility for the product companies, extended core values are used
that supplement the corporate core values. Volvo Car has, for example,
“attractive design” as an extended core value. The logic is consequently that
although all brand building must be based on one or several of the corporate
1030 core values, they can also be complemented with one or several extended core
values. During one of our discussions, Leif Ahlberg, VP for brand management
at the Volvo Group, drew a parallel between a core value and a melody that
should always be recognisable, regardless of musical genre or instrument.
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Product attributes – building the core values into the product


With the core values as guiding themes, the task of R&D and design is that of
building the core values into the product. This way of thinking differs radically
from product styling, which is limited to cosmetic changes (Light, 1994). The
goal should instead be to make the product exude the brand’s identity.
The Volvo brand is based on and summarised largely by the core value of
safety. This core value can, as stated earlier, be attributed to the founders and
their view of the principles of automobile manufacturing and the role of the car
in society. The core value can also be traced to the company’s physical
products, i.e. the product programme, product development, and product
design. Examples of Volvo’s track record (Volvo safety features, 1927-1996) are:
reinforced passenger compartment (1944), padded dashboard (1956), seat belts
for the front seats (1957), forward and rear collision zones (1966), collapsible
steering column (1966), seat belts for the back seats (1967), side collision
protection (1973), energy-absorbing bumpers (1974), side air bags (1994), and
air bags for side windows (1998). Safety is a way of thinking at Volvo: “How
does this design affect safety? This is one of the first questions that is asked of
our engineers at the start of every new project”, says Fred Bodin, CEO of Volvo
Aero. Safety thinking has developed into a distinctive competency at Volvo.
This is reflected in technological know-how, but also in the way of seeing the
manufactured products. Instead of product development steering brand
development, brand development generally steers product development.
The main competitors of Volvo Car manufacture products that are,
objectively speaking, just as safe as those of Volvo. However, it is Volvo that is
primarily associated with safety among car drivers. Thanks to its track record,
Volvo can talk about safety with greater credibility than its competitors. For
the competitors, safety is more of a prerequisite for competition. Despite the
fact that other car manufacturers sooner or later adopt most of the product
innovations that Volvo introduces, the fact that Volvo has often been first
strengthens the link between Volvo and safety even further. This association is
of more durable character, and constitutes a source of the brand’s competitive
strength. The physical expressions of the core value of safety are consequently
possible to imitate. The core value of safety as a part of the organisation’s Corporate brand
approach and its association in the minds of customers are, in contrast, more building
difficult to imitate. The combination of core competencies and core values gives
Volvo a leverage that is critical for the company’s competitiveness.
At Volvo, people strive to “own” their interpretation of the concept of safety.
The fact that the term’s meaning is not given requires that it be discussed,
defined, and interpreted within the organisation. Although it is possible that
1031
other competing brands have the same core value, its interpretation and
expression are decisive. For example, Mercedes also has safety as one of its
core values. Its definition of safety is, however, described at Volvo as “safety
according to specification”, which is regarded as forming a more limited view
that focuses on the physical product’s technical safety. At Volvo, in contrast,
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safety is described as “care for man”. This wider interpretation of the notion of
safety means among other things that the perspective has been widened to
encompass more than the car and concern about its passengers. For example,
Volvo has taken part in arranging international conferences on traffic safety
together with the UN-affiliated World Health Organisation (WHO), and the
company is also a sponsor of various research projects dealing with traffic
injuries.

Brand personality – human traits that reflect the core values


The choice of core values and how they are expressed reflects the personality of
the brand. The interpretation of the core values such as they are expressed in,
for example, action and communication forms to a large extent the image of the
brand. To personify the corporate brand, the impressions that the
communication creates must be in agreement with the values that the
company claims to stand for.
At Volvo, people strive to create a feeling of “this is my kind of company”
with the target groups. The ambition is for customers to adopt the values that
Volvo stands for, and identify with the corporate brand. An important role for
Volvo as a corporate brand therefore becomes – in addition to identifying and
differentiating – the creation of trust.
On a corporate brand level the aim is to create “Volvo as a trust mark”
(AB Volvo, 1997, p. 1). An example that is often recounted in internal
discussions is how PG Gyllenhammar, the former CEO of Volvo, handled an
inflamed environmental debate (Hedlund and Johannesson, 1996). The CEO
sent a personal letter to the media in order to explain and defend the company’s
actions. It was not only the action of the company, but also one of its core
values – that is, concern for the environment – that Gyllenhammar defended.
With arguments that appealed to readers’ feelings, PG Gyllenhammar
expressed his personal and his company’s engagement in environmental
issues. This illustrates among other things how the defence of a core value
EJM becomes an expression of the personality of the corporate brand. In this case, it
37,7/8 was ultimately a question of creating sympathy and trust.
On the product brand level, Olle Victorin – a project manager with
responsibility for the Volvo Cars account at the Forsman and Bodenfors
advertising agency – describes the personality of Volvo Cars with words like
“informal” and “critical distance”. The profile for Volvo that Forsman and
1032 Bodenfors is striving for, according to Victorin, is “an individual who is
generous and who is impassioned”. The basis is the core values, but especially
the underlying meaning in the notion of safety, such as security. Volvo Car is
“more casual and not quite as strict as its main competitors”, reasons Victorin.
Humanism and modern family values are nuances that Forsman and Bodenfors
use to express the human traits of Volvo. One way of describing the logic is by
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saying that the core value of safety is linked via “the modern family” to the core
value of concern for the environment, while quality as a core value is regarded
as a precondition.

Positioning – defining the category based on core values


Positioning is primarily an efficient way of communicating the brand’s image
(Ries and Trout, 1986), while core values are guiding themes for long-term
creation of value and meaning with their roots in the brand identity. The role of
the core values in the brand building process differs from that of positioning by
being more enduring and more deeply rooted in the organisation’s value
foundation.
At Volvo, the core value of safety is closely associated with the overarching
positioning. In this particular case, this makes it difficult to draw clear
boundaries between the two concepts. This has a historical explanation. In
conjunction with an exhibition in 1972 in Washington, DC, Volvo displayed a
safety concept car that attracted considerable media attention. This occasion
was, according to Sven Åke Ståhl, manager of global marketing for Volvo, a
breakthrough for Volvo’s positioning. However, according to Ståhl, the attitude
in the auto industry was that safety could not be used as an argument for
selling cars. As far as Volvo was concerned, this meant that the company –
essentially without direct competition – could focus on safety, which in
hindsight can be seen as a first-mover advantage. Volvo introduced a new way
of evaluating cars, and thus created a new category and a position around the
concept of safety.
Bengt Junemo, a project manager with Volvo Cars, argues that although the
positioning of Volvo Car is carried out to a large degree through the various car
models, safety is the point of departure that is continually given new nuance.
According to Sven Åke Ståhl, the initiative and conviction of a number of key
persons has had great significance for Volvo’s success in maintaining its
consistent positioning. There are always factions who argue that safety has
been exploited to its maximum, and who therefore want to say something new
or different. Leif Ahlberg, VP for brand management, the Volvo Group, Corporate brand
emphasises that it is ultimately, the customers – not the organisation – who building
determine whether the promise that the brand represents is fulfilled or not.

Communication strategy – core values as a themes


In a core value-based corporate brand building process, the core values become 1033
the theme of communication. They can be used as common denominators that
are interpreted, coded, and communicated by the sender, interpreted and
decoded by the receiver (Berg and Gagliardi, 1985; Mick, 1986; Fiske, 1990;
Mollerup, 1995; van Riel; 1995). Over time, a successful process of this kind
results in the brand acquiring a meaning and content that agrees with the
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brand identity. One of the tasks of communication therefore becomes that of


expressing and translating the core values into messages that interest and
appeal to customers.
When safety became a theme for Volvo Car in the mid-1970s, the results of
crash tests, crash test dummies, and descriptions of the safety details of
designs became recurring elements of communication[2]. The sign-off was:
“Drive Safely. Volvo”. The arguments in favour of safety differed markedly in
both form and content from traditional car advertisements. “When did you last
hear a car salesman speak about safety?” was an example of a headline in a car
ad by Volvo Car that targeted the low interest in safety among the car industry.
Volvo wanted to elevate safety as an important aspect in the choice of a car in
order to achieve a change in attitudes. According to Sven Åke Ståhl, manager
of global marketing at Volvo, the introduction of the seat belt as a standard
feature in the US car market was not a customer-driven decision, but rather
something that Volvo carried out based on its own convictions. In conjunction
with another introduction in the area of safety much later, Volvo referred back
to the opposition to seat belts: “Volvo introduces daytime running lights.
(People once laughed at seat belts too).” Rational arguments are directed at the
target group’s common sense while at the same time there was an emotional
undertone. An advertisement with a car model from Volvo surrounded by
crash test dummies included the introductory text: “It takes a lot of dummies to
make a car for people who think.”
An example of a subtle expression of a more recent date of the core value of
safety by Volvo was an ad campaign that depicted egg cartons. The ad was,
aside from the Volvo logo, entirely without text. The metaphor was intended to
express the link between safety and Volvo. For those who do not know about
Volvo and its commitment in the area of safety, these ads were probably
meaningless, quite simply because they did not know the codes. Olle Victorin,
project manager at the Forsman and Bodenfors advertising agency, strives for
communication that simultaneously “provokes and confirms” the picture of
Volvo. This is a line that has been used in recent years to achieve a
displacement of Volvo from the mainstream to the premium segment.
EJM A core value should not be regarded as a slogan or a payoff. Core values are
37,7/8 consequently not intended to be used directly in external communication, but
rather first interpreted and then only indirectly expressed. This is a significant
difference, since a core value that is repeated like a mantra runs the risk of
losing both its meaning and its value. According to this line of reasoning, it is
the meaning of the core values that should be communicated so that they are
1034 not reduced to meaningless words. Ideally, the core values will be experienced
by customers who understand their meaning as a result of prior experiences
with the company’s products, behaviour, communication, and so on. The
creative element in communication of the core values should consequently lie in
their continuing expression.
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Internal brand identity – the core values as a mind-set


In order for the core values to be able to function as a link between the identities
of the organisation and customers, it is important that everyone understands
and is in agreement about what the core values are and what each core value
represents. The goal is for the organisation to live its core values, and thus its
brand (Balmer and Wilkinson, 1991; Balmer, 1995; Harris and de Chernatony,
2001; Urde, 1999; Ind, 2001). This effort creates the possibility for the core
values to, with time, become transformed into an approach that permeates
thinking, ways of working, and behaviour.
To further the organisational commitment to the corporate brand, Volvo
formed the Core Value Group[3] in 1995. The idea was that responsible
representatives for the various product areas were appointed to the group and
given an opportunity to offer their views on the corporate brand. The members
of the group could voice and discuss their thoughts about the theory and
practice of matters related to brand building. An important principle is that
everybody in the group must understand that at the end of the day, the interest
of Volvo as the corporate brand overrides the interests of individual product
companies. The most important task of the brand forum is to work for the
development of the Volvo corporate brand and, at the same time, ensure that its
core values and identity are protected. Leif Ahlberg describes his view of the
brand building process with an example from the core value group:
The Brand building process must be an evolution not a revolution. At one stage, an
international advertising agency attempted to push through a change to our brand identity
that can, at best, be described as a revolution. Their suggestion laid far too much weight on
the current market situation so the core value group said stop, that is enough, and decided to
promote a style that would reflect the history and soul of Volvo.
The core value group is also responsible for evaluating the brand building
process. This includes the use of international tracking studies to see how the
three core values develop in each market and in each product area. The group is
also accountable for managing the development of the various policies and
control documents, such as the Volvo brand management policy. These, in their
turn, refer to a number of specific documents that affect such matters as Corporate brand
sponsoring. building

Conclusions and implications


The discussion in this article about core value-based corporate brand building
is, in the first instance, linked to lines of thought encompassed by corporate 1035
strategy thinking (e.g. Collins and Porras, 1998) and resource-based strategy
perspectives (e.g. Prahalad and Hamel, 1990), symbolic management (e.g. Berg
and Gagliardi, 1985) and the expressive organisation (e.g. Schultz et al., 2000;
Hatch and Schultz, 2001; Knox et al., 2000), brand and corporate brand
management (e.g. King, 1991; Kapferer, 1992, 2001; Keller, 1998; Balmer, 1995;
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Melin, 1997; Urde, 1997), corporate identity (Olins, 1989, 2000; van Riel and
Balmer, 1997), corporate communications and reputation management (e.g.
Bernstein, 1984; van Riel, 1995; Fombrun, 1996), and organisational theory (e.g.
Senge, 1992). An eclectic approach to research into corporate brand
management (Balmer, 1995) is needed to join the aforementioned areas into a
meaningful whole from which cross-fertilisation and new ideas can flourish.
In an era where it is becoming increasingly important to sustain a
competitive advantage (Balmer, 1995), corporate brands can no longer “just
stand there, they must stand for something” (Wrench, 2001). This article, which
offers a framework on which to build a corporate brand’s value, contributes to
the research into the nature, role and function of the core value.
To conclude the discussion, core values can be defined as all-embracing
terms that sum up the identity of the brand as well as being the guiding
principles for all internal and external brand building processes. A
characteristic of a core value is that it is a dynamic rather than an inactive
description. This implies that the core values shall be guiding factors and
represent a direction for product development, behaviour and communication
processes. Although the core values must be seen as lasting factors, they must
also be dynamic by nature and continually be adapted and developed so as to
encourage a sense of challenge and adventure that is relevant both internally
and externally. It should also be pointed out that because the requirements of
the core values are continually revised, it is not possible to satisfy these
requirements and therefore the company achieves its core values through
action. Neither is it possible to choose or create a core value that is not already
firmly established in the organisation; if this is not the case they are just empty
words. It is not a requirement of the core value to be unique, but it is a
requirement that interpretation and expression are. The creative aspects should
target the interpretation and usage of the core value and not the creation of new
core values.
The purpose of a core value-based brand building process is to establish a
unifying common thread. And the reason for talking about three core values is
to ensure that the functional, emotional and symbolic dimensions of the
EJM corporate brand are all included. Another way of putting this is to say that the
37,7/8 three core values must stand for and persuade through the use of logos (logical
argument), ethos (character and personality) and pathos (feelings).
In the internal brand building process the core values link mission, vision
and organisational values, they also affect the brand architecture, product
attributes, brand positioning and communications strategy. This means that
1036 the core values influence continuity, consistency and credibility in the building
of a corporate brand. The core value can also work as a link between a
corporate brand and product brands.
In the external brand building process, the core values are realised through
added values. It should be understood that they will also affect the image of the
corporate brand.
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Implications
From both a theoretical and practical perspective, there is a need to link core
competencies to core values. The challenge is to organise a company’s resource
base and internal processes in a manner that both strengthens and
differentiates the core value. The goal should be to ensure that the core
values that the corporate brand stands for are expressed as added values that
the customer experiences as useful and unique; they must also be difficult for
competitors to imitate. The factors that link core values and the corporate
brand are decisive for brand equity and competitive strength; and all work
associated with the core value promise is a step towards an increased level of
brand orientation. Such a process must have the full support of the executive
management and the organisation as a whole. The implementation of core
values and organisational commitment are examples of areas that need more
research.

Notes
1. Today, AB Volvo is an independent company that manufactures and markets trucks, buses,
aircraft engines, marine engines, and construction equipment. At the same time, Volvo is an
independent brand for cars within The Ford Motor Company. The Volvo trademark is
jointly and equally owned by The Volvo Group and The Ford Motor Company. Despite the
fact that Volvo as a single company no longer exists, it is the intention of the two
corporations to continue to develop and protect the Volvo brand. A comment by Ford Motor
Company CEO Jack Nasser on CNN when the price of the acquisition reached SEK50 billion
was that “Volvo stands for values that belong to the future”.
2. The background material in this section comes from “The Volvo copy platform and
communication directives” (AB Volvo, 1989) and Perrier (1993).
3. Within the Volvo group this forum is now known as the Group Issue Board: Brand
Mangement. The author was invited to participate in the forum’s first two meetings in 1995.

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