The case of Fria’s rebranding

Course: Principles of Business

Authors: Lyron Hooi (1141260),
Camila Gonzalez Gonzalez (1141163)
Sophie Storm (1143212)
Jersey Rodrigues da Cova (1142232)
Christephor de Windt (1142690)
Lionel Leito Fuentes (1140663)

Introduction
Fria is a well-established beverage brand based in Curaçao, a beautiful Caribbean island
renowned for its stunning beaches and vibrant culture. However, the brand's recent logo and
packaging change has caused a stir in the local community, with many expressing
disappointment and frustration over the sudden rebranding.

Fria had been known for its iconic logo and packaging design for many years but recently
decided to update its visual identity without announcing the change. This decision was not well
received by many locals, who felt that the new design was a departure from the brand's heritage
and identity.

As a result, many members of the community are currently boycotting the brand and choosing
not to support it. Despite Fria's commitment to quality, innovation, and sustainability, the
controversy over the rebranding has had a negative impact on the brand's reputation in
Curaçao.

Nevertheless, Fria remains a significant player in the beverage industry, offering a wide range of
drinks that cater to different tastes and preferences. Whether the brand will be able to win back
the support of the local community remains to be seen, but one thing is clear: the controversy
over the logo and packaging change has had a significant impact on Fria's standing in Curaçao.
In this article, we will touch on Unorthodox economics what it is, and how companies should
adapt accordingly. How a brand can represent value to its customers and how this value relates
to performance. Relating a chosen variable concluded from a questionnaire concluded on Fria’s
rebranding. And finally, advice on how it should have been done and what Fria can do to
improve the situation.

Unorthodox Economics and the Relation with

Firms
Unorthodox economics refers to economic theories and practices that are different from
mainstream classical economics. Unorthodox economists seek to challenge conventional
assumptions and models. They offer alternative ways, to understand economics. That better
reflects the complex, dynamic, and social uses of economic activity. Economists use a narrow
focus on individualistic behavior and the assumption of perfect markets. Unorthodox economists
argue that these assumptions are unrealistic. Do not capture the full complexities of human
behavior and the economy (Ecological Economics | Journal | ScienceDirect.com by Elsevier,
n.d.). Instead, they argue for a more general approach that takes into account social and
psychological factors. Such as the role of power, institutions, and culture involved in shaping
economic outcomes.

An example of unorthodox economics is feminist economics. Feminist economists argue that

traditional economic models and policies have ignored women’s unpaid labor in the community
and have confirmed gender inequality in paid work. (Feminist Economics, n.d.) They advocate
policies such as paid parental leave, affordable child care, and equal pay for equal work.

Another example of unorthodox economics is ecological economics. Ecological economists

argue that the economy has a place in the natural environment and that economic growth and
resource harvest must be balanced with, environmental sustainability and social well-being.
They support policies that prioritize conservation and renewable energy and recognize the limits
of economic growth (Ecological Economics | Journal | ScienceDirect.com by Elsevier, n.d.).

Behavioral economics is a newer branch of unorthodox economics that uses insights from
psychology and neuroscience. To better understand economic decision-making. Behavioral
economists argue that people do not always behave rationally or in their own best interests and
that biases and the social aspect determine economic behavior. They want policies that
encourage people to make better decisions, such as default options for retirement savings or
organ donation.

To conclude, unorthodox economics offers a range of criticisms and alternatives to the classical
model of economics. By challenging the assumptions and models of classic economics.
Unorthodox economists seek to create more socially relevant approaches that better reflect the
complexities and diversity of economic activity. (Slade-Caffarel 2019). To give everyone a clear
picture and ensure that everyone understands how the economy is constructed. Businesses
must be prepared to adapt to changing economic conditions to remain competitive and
profitable. Here are some general guidelines companies can follow to adapt to changing
economic conditions (Key Strategies for Business Leaders in the Changing Global Economy,
2022)

1. Monitor market trends and adjust strategies: Monitor trends and changes in the market to
keep business strategies moving with the market. For example, if a particular industry is
experiencing a downturn, it may be necessary to switch to a new product or service to remain
profitable.

2. Stay flexible: Be prepared to make quick decisions and adjust plans as needed. This may
include adjusting production processes.

3. Focus on innovation: In times of economic uncertainty, innovation can be a key driver of

growth. Encourage employees to develop new ideas and solutions to stay ahead of the
Company.

4. Maintain financial flexibility: Monitor cash flow and maintain a healthy balance to weather
economic peaks and troughs. This may include saving money, reducing expenses, or seeking
new sources of funding.

5. Ensure resilience: Prepare for the unexpected by diversifying supply chains, developing
emergency plans, and building backups of critical resources.
Ultimately, everything relies on the position the company holds. Every company should take into
account its size and the value it has built from its brand. Small or big values affect how
consumers interact with your company.

How a brand represents value and how value

relates to performance
A brand represents the value that a product or service provides to its customers. The value of a
brand can be defined as the benefits or advantages that customers receive from using the
product or service, and the perception of those benefits in the minds of the customers.
“Consumers develop various associations with the brand. Based on these associations, they
form the brand image. It is a unique bundle of associations within the minds of the target
audience” (Jain, 2017).
A strong brand represents a strong value proposition that meets the needs and desires of
customers. If a brand delivers on its value proposition, customers are more likely to perceive it
as a valuable brand, leading to increased customer loyalty and advocacy. This is called brand
loyalty which is built over the course of time. “It reflects how likely a customer will be ready to
switch to another brand, especially when that brand makes a change, either in price or in
product features” (Jain, 2017).
Constantly delivering on what the customer wants over a significant period builds a strong base
for the brand and creates brand heritage. A brand that has a heritage has more brand loyalty
than a brand without one. Brand equity is what is built from previous investments in the brand
itself. Brand equity, Brand loyalty, and brand image all together build the value a brand can have
and what effects it has in the market, and how it will be perceived in the future. “A brand
association comprises all brand-related thoughts, feelings, perceptions, images, experiences,
beliefs, and attitudes, and is everything connected in memory to a brand.”(Nana &
Tobias-Mamina, 2019)
In the case of Fria, it has built a big heritage on the island with local ads and is offered in a lot of
the local fast-food establishments. Fria imposes a big brand value on the island easily because
normally islands have to import from outside and are dependent on other countries.” Island
Based Firms (IBF) which are physically isolated and face additional barriers in accessing and
participating in the global economy.”(Hoelen & Rojer, 2021).
Having a local brand already sets the bar high in brand value for the people on the island.
Furthermore, the value of the island firm becomes stronger because of the small size of the
island and its barriers. A brand represents the value of the heritage and the equity it has built
over the course of time which leads to more brand loyalty and brand advocacy. “Born and
nurtured over decades or even centuries, heritage brands have had the time to build a
meaningful past, and having a heritage helps to make a brand relevant to the present and
prospectively to the future” (Wuestefeld & Hennigs, 2012). A brand has value when it has been
built over a course of time, this influences how consumers see the brand and how they react to
the brand's decisions. This is overall how a brand can represent value. However, does it affect
performance?

The value of a brand plays a crucial role in determining its performance. A brand that is
perceived as valuable by consumers can enjoy a competitive advantage over its rivals. This is
because consumers are more likely to choose a brand that they perceive as distinct and aligned
with their personal values. As a result, brands that have a high value can attract more loyal
customers and have higher profitability.

These are some ways in which brand value relates to performance:

1. Costumer satisfaction: Kotler and Keller (2016) said that customer satisfaction was
clients’ perceptions of happiness or frustration due to a comparison between the performance of
a product/service and clients’ expectations. The value of a brand can have a significant impact
on customer satisfaction as it influences the perception of the brand and its offerings. When
customers perceive a brand to be trustworthy, consistent, and aligned with their values, they are
more likely to be satisfied with their experience.

2. Customer loyalty: Strong brands are likely to have higher levels of customer loyalty.
Customers are more likely to continue purchasing from a brand they trust and have positive
associations with, rather than switching to a competitor. This can lead to repeat business and a
stable customer base. “Customer loyalty has been identified as the principal factor in a business
firm’s success” (Yap, 2012).
3. Reputation: Strong brands have a reputation to uphold. This can lead to better business
practices and higher levels of customer satisfaction. A strong reputation can also lead to
positive word-of-mouth marketing and a larger customer base.

Rebranding can be a risky move for a brand, as it can cause a drop in brand value and
customer satisfaction. When a brand undergoes rebranding, it can alienate its existing
customers who are familiar with its previous branding, leading to negative reactions and
confusion. (Aaker, 1996 ) suggests “ focusing on the brand heritage, which allows a brand to be
rejuvenated by exploiting existing values”. In some cases, customers may feel that the brand
has lost its identity or no longer represents its values. This can lead to a decline in customer
loyalty, and customers may choose to switch to competitors who better align with their
preferences. “Rebranding a company’s name or some other part of the business is seen as a
factor that can affect brand loyalty positively or negatively, depending on the situation” (Wourlu
& Ahmed 2019) To mitigate the negative effects of rebranding, it is essential for brands to take
measures to communicate the change effectively to their customers, listen to their feedback,
and involve them in the process as much as possible. This can help to ensure that customers
understand the rationale behind the rebranding and feel that their opinions are being heard.
Overall, brands should be aware of the potential risks and benefits of rebranding and carefully
consider the impact on their brand value and performance before making such a move.

The rebranding of the soda brand Fria has had significant negative effects on customer
satisfaction, customer loyalty, and brand reputation. Before the rebranding, Fria was one of the
few local brands that Curacao had, and it had a strong following of loyal customers who
appreciated its unique identity and taste. However, when Coca-Cola bought Fria and drastically
changed the brand image, the original identity of the brand was lost, leaving its consumers
unhappy.

One major reason for the decrease in customer satisfaction was the lack of involvement of the
brand's audience of consumers in the rebranding process. The changes happened abruptly, and
there was no room for adaptation. This left consumers feeling blindsided and disrespected, as
they had no say in the direction of the brand they grew up with and felt identified with.
Furthermore, the new branding was almost identical to the Fanta logo, making customers feel
even more betrayed because of the lack of originality. “if the difference between the old logo and
the new logo is not as noticeable, the impact is reduced or eliminated” (Ha et al., 2011). One
clear example of this is the comments in the Facebook posts of the new Fria image where
different users commented photos of the soda Fanta and commented sarcastically “super
original” or other comments as “ the old one is more pretty” “bring the old back” “ breaking my
childhood memories like that, thanks Coca-Cola”. “ Research has shown that customers are
more likely to embrace a new brand if the visual identities are similar to the old brand” (Bamfo et
al., 2018).

Overall, the rebranding of Fria had a negative impact on customer satisfaction, customer loyalty,
and brand reputation. This highlights the importance of involving consumers in the rebranding
process and considering their opinions and attachment to the brand's original identity. Without
this consideration, a brand risks losing its loyal following and damaging its reputation in the eyes
of its customers.

In addition to the negative impact on customer satisfaction, customer loyalty, and brand
reputation, the rebranding of Fria is also likely to lead to a decrease in the brand's overall value.
When a brand loses its identity and the trust of its consumers, it becomes less valuable in the
marketplace. This can lead to a decrease in sales, as consumers are less likely to choose the
brand over competitors. Furthermore, a damaged brand reputation can lead to difficulties in
attracting new customers and retaining existing ones, as consumers may perceive the brand as
unreliable or untrustworthy. It is important for brands to carefully consider their rebranding
strategies and involve their consumers to ensure that they maintain their competitive edge and
retain the trust of their loyal customers.

Chosen variable concerning the case of Fria

Curaçao being a spiritual and religious island makes it so the community is traditional and
orthodox. It translates to the people not adapting to changes as easily as other communities.
Therefore with help of the conducted survey you could’ve seen that response and determined
that many people did not accept that change. Fria is a product that represents us as people
who really didn’t need a change and due to its sudden change didn’t sit well with the
consumers. Curaçao mostly inhabits many believers/religious people and therefore makes the
people conduct an orthodox way of living. On the other hand, Fria took an orthodox way of
marketing and changed its brand to a newer model. In the past Fria incorporated the community
by adding children in their commercials. Now they took a subtle approach to the rebranding that
nobody from the outside could foresee. It made it so the two clashed with each other and
caused and upset among the consumers and that was shown via the responses from the

survey.

One study published in the Journal of Consumer Psychology found that religious beliefs can
influence consumer behavior, with individuals who strongly identify with a particular religion
being more likely to purchase products that align with their religious values and beliefs.
Additionally, the study found that consumers who view themselves as highly religious may be
less likely to switch brands or products, as they may feel a sense of loyalty to the brands that
align with their religious values.

Another study published in the Journal of Business Research examined the impact of religion on
consumer responses to brand extensions, which are new products or services introduced under
an existing brand name. The study found that consumers who strongly identify with a particular
religion are more likely to have a positive response to brand extensions that align with their
religious values and beliefs.

Based on these findings, it is possible that the religion of customers may have some influence
on the rebranding of a product. For example, if a company is rebranding a product to better
align with a particular religious value or belief, it may be more appealing to customers who
strongly identify with that religion. However, more research would be needed to fully explore this
connection and its potential impact on rebranding efforts.
Improvements in the situation
Undertaking a rebranding campaign is a significant decision for any organization, as it can have
a profound impact on consumers. Unfavorable customer reactions and confusion are not
uncommon outcomes of rebranding. In the case of Fria, a sudden decision to rebrand had an
adverse effect on some of its loyal customers who associated the product with their island and
they grew up consuming it with the original design and with had a leading effect on its brand
value and performance.

To minimize the shock and negative reactions to rebranding, Fria should have taken certain
measures. Fria must ensure that its customers understand the reasons behind the rebranding
and how it aligns with the company's strategic objectives and values. Communication through
multiple channels, including social media and newsletters, is essential in reaching as many
customers as possible. Seeking feedback from customers through surveys, social media polls,
and customer service channels is also critical. Fria must consider and respond to customer
feedback when making changes to its branding strategy.

Fria should use rebranding as an opportunity to create excitement and momentum around its
product by hosting events, launching campaigns, and engaging with customers on social media.
that will show its customers that Fria is a brand that values its customer opinions and take steps
to address their concerns. By creating a buzz and engaging with consumers, Fria can potentially
attract new customers and demonstrate its connection to the local community. “The content that
you're marketing needs to communicate a certain message, whether that's your mission, values,
or vision. Shifting your brand positioning will let your customers know what your new mission,
values, or vision is.”(Whitfield, 2023)

Although change takes time, Fria should allow sufficient time for customers to adjust to the new
branding identity. Continuous monitoring of customer feedback is essential to gauge the
effectiveness of the rebranding strategy and make necessary adjustments. Whether a
re-branding follows from corporate strategy or constitutes the actual corporate strategy, it aims
at enhancing, regaining, transferring and/or recreating the corporate brand equity"

Rebranding can be a challenging process, but with a well-planned strategy that includes
effective communication, feedback collection, excitement creation, and patience, Fria can turn it
into a positive experience for both customers and the organization. These were some of the
ways Fria could fix or could have done the rebranding process.

Finally, a more unorthodox approach to rebranding would have been better accepted by the
general public. Results from the questionnaire show that a majority of consumers are not happy
with the logo and do not approve of the way Fria was rebranded(as mentioned in the previous
part). With all of this research in mind, Fria could have done a better overall job of rebranding
considering the brand value it has in Curacao. Furthermore, the lack of appreciation for the
heritage of Fria makes the new logo a bitter taste in the public eye. As mentioned, it is not too
late for Fria to start to build the trust it had with the consumers before the logo change with
previously mentioned suggestions.
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