Modeling Brand Equity in International Nonprofit Organizations:
A System Dynamics Approach
Nathalie Laider-Kylander
And
Bernard Simonin
Fletcher School
Tufts University
160 Packard Avenue
Medford, MA 02155 (USA)
Tel: (617)627 5777 Fax: (617) 627 3712
nathalie.laidler kylander@ tufts.edu
Bemard.simonin@ tufts.edu
ABSTRACT
While nonprofit organizations and their brands are growing in importance and stature,
these organizations display surprisingly limited brand management activities. This is partly due
to the fact that no explicit brand equity models exist specifically for nonprofit organizations. The
aim of this research is to build a formal model of brand equity for international nonprofit
organizations engaged in development, advocacy and relief work, using a combination of a
system dynamics approach and grounded theory development. In doing so, we hope to contribute
to the system dynamics literature by illustrating the step-by-step process of building a model
from actual case studies rather than the traditional approach of literature review. Based on in-
depth field work in three organizations (Care, Oxfam, and World Vision), two waves of focus
groups with 18 brand managers led to the derivation and validation of a formal brand equity
model. At the heart of this model are four core variables (Consistency, Focus, Trust, and
Partnerships) and their associated causal loops. As such, this research constitutes a significant
attempt to advance our understanding of brand equity in nonprofits through modeling, and to
demonstrate the effective use of system dynamics in areas of marketing that have traditionally
not considered this methodological approach.
Key Words: Marketing, Nonprofit, International, Brand Equity, Branding, Grounded Theory
development, causal loops, focus groups.
Modeling Brand Equity in International Nonprofit Organizations:
A System Dynamics Approach
Nonprofit organizations are playing an increasingly important role in our lives and many
large international nonprofit organizations are now considered among the world’s most powerful
and trusted brands (Wooitliff and Deri 2001). At the same time, these organizations are facing
tremendous challenges in terms of their ability to implement their missions, and are concurrently
facing a crisis of legitimacy (Slim 2002).
Given this context, branding, and by extension, understanding the drivers of brand equity
is important, even critical, for international nonprofit organizations (Smillie 1995; Nadaff 2004;
and Chiagouris 2005). Y et, nonprofit managers and leaders have seemed reluctant to actively
embrace existing brand building activities (Nissim 2004; Bishop 2005; and Ewing and Napoli
2005). This is partly due to the fact that no explicit brand equity models exist specifically for
nonprofit organizations (Haigh 2005). Thus, the aim of this research is to build a formal model of
brand equity for international nonprofit organizations engaged in development, advocacy and
relief work, using a combination of a system dynamics approach and grounded theory
development. In doing so, we also hope to contribute to the system dynamics literature by
illustrating the step-by-step process of building a model from actual case studies rather than the
traditional approach of literature review.
While the call for the 25" Intemational Conference of the System Dynamics Society
(marking the 50" anniversary of the founding of the field) highlights the diversity of perspectives
and wide range of applications of system dynamics across domains, applications in marketing are
in short supply. Paradoxically, system dynamics is a methodology that seems to be particularly
well suited for the field of marketing, particularly complex system such as brand equity, but its
use to date has been surprisingly limited (Sisodia and Hurly 2002; and Sveiby, Linard and
Dvorsky 2002). While many different brand equity models currently exist (Woods, 1998; and
Knowles, 2004), to date, none are designed specifically for international nonprofit organizations.
Nor have any brand equity models been developed using a system dynamics approach. This
study aims at addressing both of these gaps.
Senge argues that a successful system dynamics model should: “organize, clarify and
unify knowledge; give people a more effective understanding about an important system; change
the way people think about and act within a system (Senge 1990).” It is our hope that this study
will do just that: 1) It answers the call for a more unified definition of brand equity (Czellar and
Denis 2002), thereby “unifying knowledge; 2) It captures explicit mental models of brand equity,
thereby “clarifying knowledge; ” 3) It also provides, “a more effective understanding” of brand
equity; 4) Finally, the model provides a framework for nonprofit managers to build and manage
brand equity, and demonstrates the use of system dynamics to marketing academics, helping
both groups “change the way they think and act.”
Next, we will briefly review some of the basic theoretical tenets of the current study;
introduce the underlying methodological approach; detail the research process and data analysis;
draw an initial brand equity model centered on four core variables (Consistency, Focus, Trust,
and Partnerships); present the results of a second empirical stage aimed at validating and refining
the initial model; and, finally, offer some concluding remarks regarding the study, its managerial
implications, limitations, and areas of future research undertakings.
Theory and Background Literature
This study draws on three main bodies of research. 1) The existing marketing literature
on branding, brand management, brand equity, and brand valuation. 2) The extent literature on
nonprofit management, the trends and challenges facing the international nonprofit community,
and the differences between nonprofits and for profits. 3) The emerging body of literature on
nonprofit brand management.
The first of these literatures provides a context to the concept of brand equity,
summarizes existing knowledge, and identifies current research trends in the field of branding
and brand management. The second body of literature on nonprofit management gives an
overview of the environment in which the case studies in this study operate, and the challenges
and opportunities they face. It also provides an overview of some of the differences between for-
profits and nonprofit organizations that can lead to insights into the variables that drive brand
equity in nonprofits as opposed to for-profit organizations. The final literature to be reviewed is
the emerging literature on nonprofit brand management at the heart of which this research and
study lies.
BRAND EQUITY
The term brand equity is used in three distinct senses in the marketing literature. The first
corresponds to “the total (financial) value of a brand as a separate asset - when it is sold or
included on a balance sheet.” The second to “a measure of the strength of consumers’ attachment
to the brand,” and the third, as “a description of the associations and beliefs the consumer has
about the brand (Feldwick 1996). The first concept is actually brand valuation and is the
determination of the financial worth of a specific brand (A bratt and Bick 2003). The second and
third concepts focus on the consumer, and are sometimes referred to as consumer brand equity.
Feldwick defines the second and third concepts as brand strength and brand description
respectively. Most of the brand equity literature, models and debate have centered on the second
concept, that of brand strength, and it is this concept which we refer to as brand equity in this
paper.
For Aaker, brand equity is “a set of brand assets and liabilities linked to a brand, its name
and symbol, that add to or subtract from the value provided by a product or service to that firm’s
customers (A aker 1996).” These assets and liabilities can be grouped into five main categories or
variables: brand loyalty, name awareness, perceived quality, brand associations, and other assets
(such as patents and trademarks), and can be thought of as the drivers and levers of the brand.
Many alternative brand equity models exist but common components include consumer
awareness, loyalty, consumer-relationships, and the positive consumer perceptions of the brand.
These models offer a measure of a brand's relative strength and resilience, insight into consumer
preferences and some suggestions as to the drivers of long-term brand equity. The methodologies
for defining and measuring brand equity vary tremendously. Indeed, many authors have called
for a greater degree of homogenization and a “universally acceptable and simple to understand
meaning” of brand equity (Woods 1998; Blackston 2000; and Knowles 2004). Reynolds and
Phillips assert that the “lack of agreement about something this fundamental (measurement of
brand equity) says much about the state of brand strategy and brand research (Reynolds and
Phillips 2005).” It is also important to note that to date, no explicit brand equity models exist for
nonprofit organizations; it is this gap that is addressed by this research.
NONPROFIT ORGANIZATIONS
The changing landscape of international nonprofit organizations has profoundly altered
the mindset and duties of nonprofit managers and leaders, and propelled them into new
competitive arenas where astute brand stewardship can be a differential advantage (Laidler-
Kylander, Quelch, and Simonin 2007). Smillie, considers that the building and nurturing of
strong global brands is critical for the future survival of many of today’s major intemational
NGOs (Smille 1995). Although having strong brand equity is certainly no panacea, it is critical
for raising funds, implementing the organization’ s mission and protecting employees and
volunteers.
Oster suggests that nonprofit organizations differ from their for-profit counterparts in at
least five major areas: their organizational culture; their human resources; their collaborative
rather than competitive approaches; the complexity of their customers; and the importance of
mission (Oster 1995). Ritchie, Swami and Weinberg add that, “some distinct features of
nonprofits make the brand concept especially relevant to them.” And suggest that they build
brand equity differently than for profits (Richie, Swami, Weinberg 1999). Finally, Sargeant and
Ford conclude that, “strongly differentiated nonprofit brands are surprisingly rare” and that,
“nonprofits are perceived as a bland homogenous mass of well-meaning but similar
organizations with which donors find it hard to bond emotionally and financially (Sargeant and
Ford 2007).”
At the same time, recent studies by Edelman PR suggest that major international
nonprofit organizations, such as the World Wildlife Fund (WWF) and Amnesty International
(AI), have greater brand trust (as defined by Delgado-Ballester as a state of confidence under risk
(Delgado-Ballester 2004)), and potentially greater brand equity, than many major multinational
corporations such as Coca Cola or IBM (Edelman PR 2003). Likewise, Wootliff and Deri argue
that, “non-governmental organizations (NGOs) are no longer perceived (of) as small bands of
activists, but rather as the new super brands (W ootliff and Deri 2001).”
NONPROFIT BRANDING
Despite the overwhelming evidence regarding the importance of nonprofit brands, some
researchers have surprisingly found that many nonprofits “devote little time, energy and care to
branding (Nissim 2004).” Other authors suggest that, many “nonprofits do not effectively utilize
and manage their brands (Bishop 2005).” Ewing and Napoli agree. They are surprised that “the
concept of brand management has been largely overlooked (Ewing and Napoli 2005).” Bishop’s
recent research conducted in New Zealand, suggests that in nonprofit organizations, “brand
management is neglected because marketing itself is seen as a limited range of activities, mainly
concemed with fundraising (Bishop 2005).” These findings are counterintuitive, particularly in
the light of the literature that so clearly proclaims the importance of branding for nonprofit
organizations. In fact, it is very likely that many of the international nonprofit organizations with
strong brands, do expend energy and resources building brand equity but the models they use are
implicit and intuitive (mental models). They do differ from the existing for-profit models of
brand equity.
Judd argues that, “nonprofit organizations need strong brands just as much as
corporations” and that “building brand equity should be a priority for nonprofit groups large and
small (Judd 2004).” Keller adds that, “strong brands are supported by formal (read explicit)
brand-equity-management systems (Keller 2000).” It also seems clear that the management of
the assets and liabilities that make up brand equity, require some type of model (Aaker 1991).
Little research has been devoted to nonprofit brands despite the growing importance of these
organizations and their brands. The lack of an explicit nonprofit brand equity model is a
challenge for international nonprofit organizations; it partly explains the reticence to date of
nonprofits to actively manage their brands. Given the many differences between nonprofits and
for profits, simply applying an existing for-profit brand equity model would be less than optimal
(assuming that one could even choose a model among the dozens of existing for-profit models).
The current study aims at circumventing this important drawback and at providing nonprofit
managers with explicit guidelines for brand equity management based on the mental models
currently used in their sectors.
Methodology
The approach of this research is one of theory building using both grounded theory
development through case studies, and a system dynamics approach. Case study research has
been found to be an effective methodology in marketing when there exist a paucity of knowledge
and theory, and when the phenomenon to be studied is broad and complex (Bonoma 1985). In
particular, case studies have proven useful for generating both theoretical and practical insights
in the field of nonprofit marketing, (Austin 2000).
Eisenhardt’ s eight step process of grounded theory development from case study
research, considered a reference research methodology, is based on Glaser and Stauss’ work
(Eisenhardt 1989). Glaser and Straus established the principles of grounded theory as the
inductive development of theory from qualitative data, using a general method of comparative
analysis (Glaser and Straus 1967). Eisenhardt notes that, “the striking feature of research to build
theory from case studies, is the frequent overlap of data analysis with data collection.” She
advocates the analysis of the empirical material simultaneously with ongoing data collection in
order to adjust data collection instruments and adding new cases if they provide additional
insight.
Qualitative data is the main source of information in the modeling process of many
system dynamics models (Sterman 2000). Forrester suggests that in system dynamics, “Model
building should be a circular process of creating a model structure, testing behavior of the model,
comparing that behavior with knowledge about the real world being represented and
reconsidering structure (Forrester 1991).” It is important to note that the iterative nature of
Eisenhardt’s methodology above is analogous to the system dynamics approach wherein the
initial model is tested and adapted several times on the basis of feedback from interviewees.
While there is general agreement about the importance of qualitative data during the
development of a system dynamics model, there are few clear description about how and when to
use it (Luna- Reyes and Andersen 2003). These authors suggest that many system dynamics
approaches lack transparency in the modeling process, particularly when it comes to collecting
and analyzing qualitative data. They recommend “introducing strong qualitative methodologies,”
specifically citing the use of grounded theory development, “to system dynamics, to strengthen
the modeling process by systematically eliciting the information contained in the mental
databases of the experts (Luna-Reyes and Andersen 2003).” Williams agrees, and argues that,
“the case for combining system dynamics modeling and case study research approaches is
strong,” but that “research designs that extensively combine both are rare.” He adds that,
“simulation modeling and case study are powerful research methods whose added advantages
can complement each other in term of theory building” (Williams 2000).
In essence, the parallel use of these two methodologies: grounded theory development
using case study research and a system dynamics approach, is expected to strengthen the
development of a brand equity model for international nonprofits. A pertinent example is the
recent article by Repenning and Sterman, on Capability Traps, that follows Eisenhardt’ s research
design and uses System Dynamics for theory development based on case studies (Repenning and
Sterman 2002).
Conducting the Research and Analysis
The research was conducted in two phases, both using a focus group approach. In the first
phase, the focus groups consisted of two parts: 1) a series of semi-structured questions; and 2) a
set of system dynamics exercises. The second phase of the research was based on the analysis
conducted from the first phase and also comprised two parts: 1) the validation of causal loops;
and 2) the operationalization of key variables. The focus groups or group model building (GMB)
sessions were conducted following the recommendations outlined by previous researchers
(Anderson and Richardson 1997, Ford and Sterman, 1988, Luna-Reyes and Anderson 2003,
Martinez-Moyano and Richardson 2002, and Sterman 2000).
The potential case study population of this research is defined as large, well-known
international nonprofit organizations working in all three fields of development, relief and
advocacy. The member charities of Global Impact (50 organizations) in the U.S. are a fairly
representative sample. In addition, the UN organizations, the Red Cross organizations, and large
international human rights and environmental advocacy organizations were also included. The
total estimated population is therefore estimated at around 80 international nonprofit
organizations. Based on the theoretical sampling approach and existing access opportunities,
three relatively similar organizations were selected: CARE, Oxfam International, and World
Vision. These are all large international organizations, Anglo-Saxon in origin, well-known, and
broad based (being active in development, relief and advocacy). In terms of selecting key
informants in each organization and codifying the information shared in the various sessions, the
use of a gatekeeper, flip-charts, and audiotape recording were adopted. Finally, in keeping with
grounded theory development, all data was analyzed using a constant comparison methodology.
DATA COLLECTION
As indicated above, data collection was carried out in two distinct phases. The objective
of the first phase was to develop an initial system dynamics model of brand equity in
international nonprofit organizations by tapping into the “mental models” of participants from
each of three case studies: Care, Oxfam and World Vision, using a focus group approach. The
objective of the second phase was to refine and test this initial model through a second series of
focus group sessions at these same organizations.
Focus groups or group brainstorming sessions, were selected as an ideal data collection
approach, well suited both for grounded theory development using case studies, and system
dynamics (Dick, 2005; and Barnett 2006). Three focus groups of 3 to 3.5 hrs, for each of the
three case studies were conducted between March 23" and May 1°, 2006. The brainstorming
sessions were audio-taped in their entirety, after obtaining signed consent. The conduct of these
sessions relied on identical Power-point presentations, used to provide an introduction and
overview of study, give an initial common definition of brand equity, guide the discussion with
an increasingly specific series of 22 semi-structured questions, introduce system dynamics, and
supply the platform for conducting three system dynamics model building exercises.
Diagram 1 below, depicts the data collection process. The shaded boxes represent the
input by the researcher using the research protocol and correspond to the two parts of the focus
group sessions. The clear boxes represent the outputs or products of the data collection process
itself and their relationships to one another.
Diagram 1
The Data Collection Process
Tnitial Causal
Loop
Diagrams
charts Modes
<------ Part One— — — — > <— ————— Part Two— — ————— >
Charts variables
PART ONE - 22 SEMI-STRUCTURED QUESTIONS
During the first part of the brainstorming session, participants were asked to respond to
the 22 questions and their answers were recorded verbatim on large flip chart sheets using the
key words and phrases used by the participants. The number of flip chart pages produced varied
between 10 and 17 depending on the organization, and the average number of words per flip
chart varied between 24 and 28. Each time a flip chart was completed, it was posted on the wall
of the meeting room for all to see and refer to. An effort was made to address each individual
question, but flexibility was granted to participants in terms of time and emphasis of their
responses. Characteristics of this part of the data collection are given below in Table 1
PART TWO - GROUP MODEL BUILDING SYSTEM DYNAMICS EXERCISES
During the second part of the session, participants were guided through three system
dynamics exercises: model boundary charts; reference modes; and initial causal loop diagrams
(Following Sterman’s recommendations (2000)). Characteristics of this part of the data
collection are also given in Table 1
Table 1
Characteristic of Data C ollection
Part One and Part Two - Phase I
CARE OXFAM WORLD
VISION
Number of participants 6 5 7
Duration of Part 1 75 mins 82 mins 89 mins
Duration of Part 2 85 mins 80 mins 115 mins
Number of flip-charts derived from part 1 10 13 17
Average number of words / flip chart 28 26 24
Number of endogenous variables 20 11 26
Number of exogenous variables 6 5 6
Number of reference modes developed o 5 0
Number of variables from the initial causal 43 48 46
loop diagrams
DATA ANALYSIS
Constant comparative analysis was originally developed for use in the grounded theory
methodology of Glaser and Strauss. It involves taking one piece of data: an interview, a
statement or a theme, and comparing it with all others that may be similar or different (Thome
2000). The constant comparison method comprises four stages: comparing incidents applicable
to each category; integrating categories and their properties; delimiting the theory; and writing
the theory. Categories are created when the researcher groups the data. These categories should
emerge out of the data (inductive analysis) rather than being imposed on prior to the data
collection (Patton 1990).
Constant comparison is at the heart of all the data analysis in this study. In some
instances, categorization evolved inductively from the data itself. In others, discrete categories of
data already existed and data was simply compared across these existing categories. The
objective in both cases, was to surface variables or themes that recurred or dominated the
specific issue under investigation.
The Recurring Variables listed below in Table 2 are those variables derived from part one
of the data collection (22 semi-structured questions) that, through a constant comparison
analysis, appear to be the most important in terms of brand equity for international nonprofits.
Table 2
Recurring Variables
Derived from 22 Semi-structured Questions
Variable Frequency of Recurrence
Focus
Consistency
Partnerships
Awareness
Trust
| cr] SI] 009] co}
Global (transcending 4
culture / language)
Distinctive 4
(differentiation)
Common variables were also determined from a constant comparison analysis of the
system dynamics exercises. Table 3 lists all the common variables derived from the constant
comparison of the model boundary charts, and Table 4 the common variables from the initial
causal loops constructed during the focus groups by case study participants.
Table 3
All Common Endogenous Variables
From Model Boundary Charts
Recurring Variable Frequency (case study)
Consistency
Integrity
(Product) Quality
Credibility
Focus
Relevance
Scandals
Coherence
Trust
Awareness
Accuracy
Partnerships
Media expenditures
Image
Message focus
Emotional connection
BYP EV} EY] EY] PV} Ey] PY] BY] KV] EY] By] Ky] EY] co] ca] co
Table 4
Final Common Variables
From Initial Causal Loop Diagrams
Consistency
Integrity
Focus
Coherence
Trust.
Partnerships
Relevance
Emotional connection
These three “lists” of variables were then compared and contrasted and the main finding
was that four common variables appear in all three lists: consistency, focus, trust and
partnerships. It is these four variables that are at the heart of the initial system dynamics model
for brand equity for international nonprofit organizations In the spirit of both grounded theory
development and system dynamics (Eisenhardt 1989 and Forrester 1991), this initial model,
composed of four causal loop diagrams, was subsequently validated in the second phase of this
research.
Initial Brand Equity Model
A series of simplified Causal Loop Diagrams (CLDs) were developed for each of the four
key variables highlighted above. These CLDs help explore the dynamic meaning of each of these
variables, the relationships and causality between these four key variables and other model
variables, and to highlight important feedback structures in the overall model (Coyle 2000).
VARIABLE MAPS
In order to summarize the information captured in the myriad of relationships between
the variables in the initial causal loops developed by study participants, Variable Maps were
developed to summarize the major relationships between variables and uncover potential loops
for each of the four key variables. These Variable Maps were obtained by systematically
combining the input and output variables depicted in each of the CLD developed during the
focus groups and tracing these back to find common pathways, using a decision tree like
approach.
Specifically, in an Excel spreadsheet, the key variable, for example, Consistency was
placed at the center of the spreadsheet. Then using the causal loops developed by the study
participants, every variable that fed into Consistency was listed in the column to the left of
Consistency. Likewise, every variable that flowed from Consistency was listed in the column to
the right of the Consistency. Then, one by one, each of the variables listed to the left and right of
Consistency were examined and the variables that flowed into and from each of them was also
listed in a similar manner (in columns to the left and right). The result of this analysis is a series
of four Variable Maps, one for each of the key variables, that lays out all the relationships
between variables and provide a visual indication of the pathways and potential loops for each of
the four key variables.
SIMPLIFIED CAUSAL LOOP DIAGRAMS
From the Variable Maps, simplified CLDs for each of the key variables were developed
and are described in tum below. The simplified CLDs are based on the data collected through the
initial CLD and the relationships between variables have all been specified by case study
participants. In six specific cases, the researcher has had to make an assumption about a link
between two specific variables. These assumptions are identified as such (researcher's
assumption) in the following sections. The reference modes (behavior-over-time-graphs)
obtained during the focus groups were also used during the crafting of the simplified causal
loops since every reference mode has a corresponding structure in causal loop diagrams
(Sterman 2000).
CONSISTENCY
Consistency seems to be increasingly important to international nonprofit organizations
as the role of internet and global communications expands. From the research data, it appears
that Consistency has three dimensions: operational consistency between parts of an international
organization (countries and functional domains); consistency in communications between and
among different brand audiences (external and intemal); and consistency between activities and
10
communications (what an organization is actually doing (identity) and what stakeholders
perceive that it is doing (image). These three roles of consistency can be summarized as: internal
consistency; external consistency; and consistency between intemal and external worlds (actions
and communications).
The following simplified CLD captures the three essential roles of consistency. The
“Internal consistency” loop shows an increase in consistency giving rise to greater reliability of
activities which in turn, results in greater product quality (researcher assumption). This in tum
results in more coherence (researcher assumption), facilitating coordination, which increases
consistency. The “External consistency” loop addresses different brand audiences and results in
increased overall visibility. This is turn has a direct positive impact on fundraising. However, an
increase in fundraising may have a negative impact on focus, since the temptation to expand
activities to absorb a broader array of funds can reduce operational focus. Focus though, has a
positive impact on consistency. This negative loop is the driver of the S-shaped reference mode
for consistency determined by the study participants at Oxfam. Finally, the “Consistency
between the internal and external” loop (which corresponds to consistency between the internal
activities of an organization and what they say they do), results in greater integrity (do what you
say you do), which impacts (among other things), trust, resulting in better and more numerous
partnerships. This reinforces the relevance of the brand and circles back to enhanced consistency.
These three loops are shown in diagram 2 below.
Diagram 2
Simplified Causal Loop: C onsistency
te Coherence
+)
Intemal consisteny
Visibility
- +
Coordination
~
constency-@—<——
‘4. + Integrity
i eat
= = ‘\
Consistency vate extemal and intemal
Relevance
~ NO
“TS
11
FOCUS
The need for focus was a recurring theme for international nonprofit organizations that
have evolved over time, adding to their activities and becoming larger and more diffuse as they
age. Interestingly, at the annual A merican Marketing Association’ s nonprofit marketing
conference of July 2006, the importance of brand focus was indeed a key theme. It appears that it
is the “lack” of focus that is a concern for organizations in this research study and that this lack
of focus is perceived as being a barrier to achieving greater brand equity.
Brand focus also plays both an internal and external role as depicted in the simplified
causal loop diagram below in diagram 3. In the “Internal role of focus” loop, focus leads to
consistency which, among other things gives rise to increased reliability for internal
stakeholders. This creates a greater atmosphere of trust internally, adding to the sense of
legitimacy of the organization and validating the mission (researcher assumption) which
continues to provide help provide focus for the organization. In the “External role of focus” loop,
focus results in increased visibility, enabling the organization to differentiate itself from
competitors in terms of a more distinct positioning. This positioning leads to a greater degree of
relevance, resulting in higher emotional connection by external stakeholders. This in tum,
solidifies the organization’ s identity (researcher's assumption) which loops back into an increase
in focus. However, from the previous CLD on consistency, we also identified that an increase in
visibility leads to greater fundraising which may have a negative impact on focus. This third,
“impact of fundraising” loop explains the growth with overshoot reference mode that was
defined by the Care study participants for focus.
Diagram 3
Simplified C ausal Loop: Focus
Consistency + Reliability,
tt) th
Intemal role of focus
+
Mission 4
oe
12
TRUST
In terms of participant's definitions, the notions of integrity, trust, accountability and
credibility are closely linked. Trust gives rise to perceptions of legitimacy which leads to an
increase in credibility. This in turn, has a positive impact on the customer experience, leading to
an increase in visibility. Higher visibility places greater demands on an organization for
accountability. Research participants expressed the fact that those organizations with more public
visibility, also received a greater degree of public scrutiny, resulting in the need for greater
accountability. This increased need for accountability results in enhanced integrity which results
in greater trust. However, increased scrutiny resulting from higher visibility can also reveal
minor (and potentially major) organizational issues which could have a direct negative impact on
trust (researcher's assumptions). Thus, two loops are created (see Diagram 4), the first is the
reinforcing “Being Accountable” loop and the second the balancing “Under the spotlight” loop.
In addition to these two loops, a third loop exists, the “Positioning Power” loop in which
trust results in a greater number of partnerships which enhances the image of the organization,
making it more relevant. An increase in relevance can lead to greater public attention helping to
differentiate an organization relative to its competitors. This is particularly important in
combating the problem encountered by many international nonprofit organizations of being “all
lumped together” such that when a scandal or negative press occurs for one organization, all
similar nonprofit organizations get tarnished by the same brush. This influence is shown in the
simplified causal loop below as an exogenous variable called NGO scandals. The ability of an
organization to differentiate itself, thereby boosting its ability to be recognizable (researcher's
assumption) results in an increase in trust.
According to Oxfam study participants, trust displays an oscillating reference mode,
which suggests the presence of a balancing loop and delays and perhaps the intermittent
dampening impact of an exogenous variable. Unless an internal issue arises or is brought to light
to erode trust directly (Increased Scrutiny loop), the assumption, in this simplified causal loop for
Trust, is that exogenous forces (NGO scandals) can negatively impact an organization’ s trust,
(because of a lack of differentiation with other similar organizations) which is slowly countered
by the two reinforcing loops displayed below. The speed at which trust is recaptured depends
somewhat on a brand's resilience to trust erosion, and the two critical variables of differentiation
and accountability.
13
Diagram 4
Simplified Causal Loop: Trust
NGO Scandals
a ae a Credbility
Partnerships Legitimacy
Ee +
A +
Relevance Customer
experience
cs, Ps i)
Positioning Power + fm + Being Accountable de
Attention Visibility
- -
- Integrity +
TS Need for
a ‘Accountability
Organizational —) 4
issues i
ue ns Under the Spotlight increased scrutiny
PARTNERSHIPS
Partnerships are those relationships not only with corporations, but with any important
group of stakeholders external to the organization itself. The relationship between partnerships
and relevance was highlighted as critical and self-fulfilling. The more numerous and visible the
relationships an organization develops, the more relevant it appears, and the more attractive it
becomes to future potential partners. This is captured in the simple “Relevance” loop (see
Diagram 5). Partnerships also however lead to an increase in fundraising (researcher’ s
assumption) which as we have seen previously, can have a negative impact on focus. This
second loop, called the “Mission drift” loop, posits that a decrease in focus results in a decline in
consistency, which in tum leads to an erosion of reliability and trust. This decrease in trust has a
negative impact on perceptions of legitimacy which reduces the attractiveness of the organization
to future potential partners. On the other hand, successful partnerships can result in an enhanced
image for an organization, leading to an increase in credibility. This reinforcing loop, named the
“Power of positive association”, links this increase in credibility to an augmented customer
experience, with a positive impact on visibility and recognition of the organization. This increase
in recognition, in turn drives higher quality, resulting in increased levels of integrity. This rise in
integrity has a positive impact on relationships in general which has a positive influence on
present and future partnerships.
14
According to the Care study participants, the partnerships variable displays an upward
oscillating trend which would suggest the presence of reinforcing loops and a weaker balancing
loop with some kind of delay.
Diagram 5
Simplified Causal Loop: Partnerships
got >? Credibility es
va
I + Customer
mage Experience
+ Focus a
ak Pr f
Fundraising Consistency 4)
-) Power of Positive Association
a
A= +
Mission Drift Visibility
L) + +
ae
Relevance
Partnerships A+ Reliability
Relevance
oe
ays Fu:
Legitimacy + _Trust
Relationships Regagaiton,
ga
Integrity yf Quality
Model Validation and Modification
The objective of the second phase of the research was to refine and test the initial model
through a second series of focus group sessions at these same onganizations. The focus groups
were conducted between November 16" 2006 and December 13” 2006 and varied in duration
between 104 minutes and 135 minutes.
Participants were shown the initial, simplified causal loops for each of the four variables:
consistency, trust, focus and partnerships and asked to validate them based on specific questions
outlined below. In addition to the research protocol captured in a Powerpoint presentation,
participants were provided with a six page worksheet that reproduced the simplified causal loops
and summarized the questions to be addressed in table format with space for individual notes and
responses.
15
DATA COLLECTION AND ANALY SIS
During the brainstorming session, lasting approximately one hour, participants were
asked to take a few minutes to examine each of the simplified causal loops and to individually
take notes on the their worksheets when answering each of the following questions: 1) Does the
causal loop ring true? 2) Are there any fundamental errors? 3) Are some variables unnecessary?
4) Do the relationships between variables make sense? and 5) What key one or two variables
may be missing? After 2 minutes of individual reflection, the participants were invited to share
their answers as a group and responses were recorded verbatim on large flip sheets using the key
words and phrases of the participants.
In the case of World Vision, given the nature of the brainstorming session being held by
conference call (instead of face-to-face), the researcher took hand written notes of the discussion
(rather than flip charts) which were not visible during the session. These notes were subsequently
forwarded to the participants for validation, although no additional feedback was obtained. As a
brief aside, despite the many benefits of conducting research using webinar technology, the
session was less rich in participation and detail. Although single interviews might work quite
well using telephone and videoconferencing, focus groups or group-based brainstorming sessions
do not seem to work quite as well. The number of major comments made for each simplified
causal loop varied between 5 and 12 as shown in Table 5 below.
Table 5
Data Collection - Phase II
Care Oxfam | World Vision
Number of participants 5 4 7
Duration of data collection 135 mins_| 116mins 104 mins
Number of comments for Consistency CLD 12 11 6
Number of comments for Trust CLD 11 10 10
Number of comments for Focus CLD 5 6 6
Number of comments for Partnership CLD 5 9 7
A constant comparison method was also used to analyze the data described above. Data
categories were developed inductively from the research data, in the same way as for Phase one
of this research. Between four and five data categories were developed for each of the four
causal loop evaluations and data from the three case studies were tabulated side by side to
facilitate the horizontal cross comparison of a total of 81 data blocks Table 6 below summarizes
the results of the constant comparison of participant’s suggestions concerning the four causal
loops: consistency, trust, focus and partnerships. Comparison of each data block was made both
horizontally, to capture the common themes between case studies and also vertically, to capture
those themes or recommendations that participants thought were particularly important. Only
those recommendations that occurred more than once were recorded and used to modify the
initial causal loops described in the previous chapter.
16
Table 6
Constant Comparison A nalysis of Causal Loop Evaluations
Recurring Comments and Frequency
CATEGORY and number of
data blocks
CONSISTENCY CLD
Fundraising to Focus - 12
It’s not just about fundraising
but about engagement and
advocacy (4)
Fundraising does not
necessarily reduce focus (3)
Lack of focus is not bad /
strength of NGO =
diversity and holistic
approach (2)
Role and position of
coordination - 4
reliability and quality should
come after coordination and
coherence (3)
Internal-external loop - 3
The most important loop is the
intemal-external consistency
loop (2)
Importance of Coherence - 6 Coherence is generic and could =| Quality is important but
be taken out (2) reliability should not be
included (2)
TRUST CLD
Partnership doesn’t fit - 5 Partnerships is a forced fit (3) Could replace partnership
with identity (2)
Differentiation or Distinctiveness is a more Attention should be replaced | Relevance leads to
distinctiveness - 7 powerful form of differentiation | by visibility (2) differentiation and vice
(3) versa (2)
Empowerment and internal Empowerment comes from
branding - 3 integrity and intemal brand
understanding (3)
Trust is a result not a driver - Recognition cannot lead to trust | The need for accountability
10
without legitimacy, visibility
and proximity (3)
also comes from an internal
decision to be more
transparent and is linked to
integrity (2)
FOCUS CLD
Visibility and positioning - 5 Positioning and visibility should
be reversed (2)
Internal focus and resources Focus allows better resource
allocation - 5 allocation and brings
effectiveness and efficiency (3)
PARTNERSHIP CLD
Should not be a key variable of | As defined here partnership Maybe partnership could be Partnerships can also
brand equity - 10 should not be included asakey | replaced by engagement or negatively impact image
variable, relevance should be the | redefined more broadly (3) and reduce distinctiveness
fourth variable (4)
(2)
Quality and integrity brand
equity - 3
Quality comes before
recognition and integrity leads
trust (2)
Fundraising - 3
Fundraising may negatively
impact focus but positively
impact visibility and is certainly
an important driver of brand
equity (2)
17
MODIFY ING THE CAUSAL LOOPS
Using the recommendations summarized above, specific modifications were made to
each of the simplified causal loop diagrams (CLD) as follows:
CONSISTENCY CLD
The “Internal Consistency” loop was simplified and the variables reliability and
coherence were removed. Although participants agreed that coordination could lead to
consistency and in turn to quality, the relationship between quality and coordination remained
unclear. We suggest that a new variable be introduced, to link the two: desire to maintain quality
(of product and services) throughout the organization, through sharing of best practices for
example.
In terms of the “External Consistency” loop, participants felt that visibility would also
lead to increased engagement and advocacy (that might positively impact quality), not just
fundraising. Many also challenged the negative connection between fundraising and focus (ie:
that increased fundraising would result in a decrease in focus). In addition, it was suggested that
fundraising would also feed back and increase visibility. We suggest therefore adding a variable
between fundraising and focus which reflects the role of the growth of the organization. The case
studies all suggest that as an international nonprofit organization grows and matures, the pressure
to add products and activities also increases, which dissipates the original focus of the
organization. The third loop, “Consistency between external and intemal,” was perceived as
accurate and relevant and remains unchanged.
TRUST CLD
Many participants felt that the partnership variable in the “Positioning Power” loop was a
forced fit and suggested replacing it with the variable identity. The attention variable was also
questioned and participants suggested either replacing it with visibility or removing it altogether.
In the interest of model simplification it was removed from the loop. It should be noted that
differentiation or distinctiveness was considered by participants as of crucial importance in brand
equity. Finally, some participants noted that recognition by itself does not lead to trust, but that
variables such as legitimacy, visibility and proximity were also important drivers.
In the case of the “Being Accountable” loop, participants felt that an additional variable,
representing empowerment derived from integrity and that accountability was driven both by
visibility externally and by an organizational decision to be accountable internally. These
comments were taken into account and the trust causal loop was modified accordingly.
FOCUS CLD
In the “External role of focus” loop, participants suggested reversing the order of the
visibility and positioning variables, and in order to be consistent, the variable growth was added
to the “Impact of fundraising” loop (as suggested in the consistency CLD above). In terms of the
“Internal role of focus” loop, the study participants suggested that the greatest internal impact of
focus was that of better resource allocation resulting in effectiveness and efficiency, which
would increase internal trust and perceptions of legitimacy, in turn validating the mission and
current focus of the organization.
18
PARTNERSHIPS CLD
Some participants challenged the choice of partnerships as one of the key variables,
suggesting that other variables such as relevance might have more direct impact on brand equity.
This justifies the decision to include the additional variables of: relevance, visibility, and
integrity as stocks in the stock flow diagram. If partnerships are defined more broadly, to include
most stakeholders and customers, participants were more comfortable with this variable as a key
variable. In the “Power of positive association loop,” participants noted that recognition does not
lead to quality and that integrity leads to trust. In addition, participants suggested that
partnerships, particularly with other organizations, might reduce differentiation. In the “Mission
drift loop,” in order to be consistent with changes to the previous loops, the variable “Growth”
was added and “Reliability” removed, with “Consistency” leading to “Quality” and in tum to
“Integrity” and “Trust.
ADAPTING VARIABLE NAMES AND INCLUDING BRAND EQUITY
Sterman advises that in system dynamics models, variable names should be nouns and
have a clear, preferably positive, sense of direction (Sterman, 2000). In addition, variable names
should be as specific as possible to avoid any ambiguity. Until this point, the exact terms and
wording defined by the study participants have been used throughout the causal loops and stock
flow diagrams. Proposed changes to certain variable names were made on this basis and are
included in the final causal loops below.
In this research on brand equity for international nonprofit organizations, brand equity is
the main dependent variable and the key independent variables have been identified as:
consistency; focus; trust; and partnerships. Until now, we have been operating under the
assumption that the independent variables act together, and indeed are intimately connected in a
series of complex feedback loops, to result in brand equity. However, we have mostly focused on
the independent variables themselves, isolating and describing their individual dynamics. We
have not yet incorporated brand equity as a variable that itself impacts other variables, giving rise
to additional feedback loops and model complexity.
With the exception of a specified link from brand equity to partnerships in the initial
CLD from the first Care brainstorming session, the impact of brand equity on other variables has
not yet been articulated. However, the impact of brand equity on other variables can be easily
inferred from the original data. From the data in this series of tables, it appears that strong
brands, brands with high brand equity, have the following abilities: internally, they provide a
common identity and culture; externally, they facilitate communication, provide an image and
competitive position, and promote trust, fundraising and partnerships. The abilities of strong
brands include: attracting partners and influencing customers (including donors), and enabling
differentiation. Given these stated characteristics, it is possible to insert brand equity into the
existing CLDs and capture the feedback structure this results in.
The following causal loop diagrams (Diagrams 6, 7, 8, and 9) are the final CLDs for the
four independent variables at the heart of the brand equity model: Consistency, Focus, Trust and
Partnerships. They are the result of the validation by case study participants whose
recommendations and suggested changes have been incorporated. These final causal loops also
reflect the change in variable names and the re-insertion of brand equity as a model variable as
discussed above.
19
Diagram 6
Final Causal Loop Diagram - C onsistency
Capacity for
engagement and. Desire to promulgate
*~, advocacy quality and spread best
a practices
‘ )
Intemal consisteny
Visibility
+ +
Internal
Consistency in + coordination
operations Ce
- IneSsagng: + Organizational
(—* 4. integrity
Consistency between external and internal +
growth 5
Operational focus / Relevance
See + Brand trust
In this final causal loop diagram for Consistency (see Diagram 6), the variable name is
made more explicit and captures the true meaning of consistency. The three loops: Internal
consistency; External consistency; and Consistency between extemal and internal remain, but
additional variables and connections between variables add some complexity and dynamics.
In the “Intemal consistency loop,” a reinforcing loop, increased consistency in operations
enhances program quality, which in turn drives a desire within the organization to spread best
practices. This stimulates an increase in the activity of internal coordination which results in
more consistency in operations.
In the “External consistency loop,” a balancing loop, consistency in messaging enhances
visibility which drives both funds raised and the capacity of the organization to effectively
engage and advocate. An increase in this last variable also boosts program quality, particularly in
terms of advocacy. An increase in funds raised not only feeds back to amplify visibility but also
results in organizational growth. It is this organizational growth, rather than simply fund raised,
that can cause an organization to become less focused in terms of both it’s activities and it’s
messaging. Finally, a decrease in focus, leads to a decrease in consistency.
In the “consistency between external and internal loop,” a reinforcing loop, consistency
produces greater organizational integrity which positively impacts brand trust. An increase in
brand trust leads to more numerous and better partnerships, which in turn, enhances the
organization’ s relevance. This increase in relevance circles back to positively impact
consistency.
20
In addition to the three main loops, consistency enhances brand equity which positively
impacts a number of variables: partnerships; brand trust; funds raised; and the capacity for
engagement and advocacy. The feedback from brand equity therefore magnifies the dynamics of
the existing structure by strengthening both the reinforcing loops and the balancing loop.
Diagram 7
Final Causal Loop Diagram - Focus
Better resource
allocation
n.
+ rN 5) Brand trust
Extemal Tole of focus : pas _
Operational focus ntemnataole OSes
+ a ;
Relevance
Funds raised +
Brand identity
+ sates Organizational
; legitimacy
—s/ Emotional connection Mission +
Impact of fandraising with customers
+ Organizational
growth
In this final causal loop for Focus (see Diagram 7), better described as operational focus,
the three loops still exist but have been modified somewhat. The “Internal role of focus” loop is a
reinforcing loop and captures how an increase in operational focus can result in better resource
allocation which in turn leads to greater efficiency and effectiveness. This boost in efficiency and
effectiveness translates to enhanced brand trust which positively influences organizational
legitimacy. An increase in the organizational legitimacy reinforces the validity and
appropriateness of the mission itself, which provides the boundaries for the organization’ s
activities, and therefore helps establish organizational focus.
In the “External role of focus loop,” also a reinforcing loop, operational focus helps
establish a strong positioning for the organization which increases its visibility in the market.
Visibility positively influences both funds raised and relevance. An increase in relevance
strengthens the emotional connections with customers which enhances brand identity. A stronger
brand identity justifies and supports the organization’ s current operational focus.
However, visibility also drives funds raised, which as we saw in the previous CLD for
consistency, results in organizational growth which negatively impacts organizational focus. As
an organization becomes larger and more diffuse, it becomes harder to maintain operational
focus. This is depicted in the balancing loop labeled above as “Impact of fundraising loop.”
21
Once again, focus, as one of the four established independent variables of brand equity,
enhances brand equity and brand equity positively impacts: brand trust; positioning; and funds
raised thereby magnifying the dynamics of all three previously discussed loops.
Diagram 8
Final Causal Loop Diagram - Trust
Brand mgr |S Organizational —— > Credbblity.
legitimacy
s
+ Customer
4) experience
#
Ree Being Accountable
or trust
ce Pe +
" Decision to be more
wh accountable
Differentiation Brand recogniti,
Se Organizational
integrity 4. oe e
"
NGO Scandals Orgnvational K)
‘issues 4 Increased Scrutiny
Under the Spotlight
In this final causal loop for trust (Diagram 8) the two reinforcing loops: “being
Accountable” and “Positioning power” are attenuated by the balancing loop “Under the
spotlight.” This causal loop diagrams also has an exogenous variable, NGO scandals that directly
dampens brand trust.
In the “being Accountable loop,” brand trust has a positive impact on organizational
legitimacy which in turn, enhances credibility. This increase in credibility positively influences
the customer experience which drives up visibility. An increase in visibility results in a greater
needs for accountability as well as increased scrutiny by actors outside the organization. The
increase in the needs for accountability pushes up organizational integrity. The internal
organizational decision to become more accountable is a direct result of this increase in
organizational integrity and feeds back to enhance the need for accountability, this time from an
internal perspective. In this way an additional small reinforcing loop is established that drives up
organizational integrity which results in an increase in brand trust.
At the same time, the rise in visibility results in increased scrutiny by external actors.
This increased scrutiny can result in organizational issues, small and large, being uncovered.
Even the fact that an organization is under increased public scrutiny can imply that
organizational issues might exist, causing a negative impact on that organization’ s brand trust.
This dynamic is captured in the reinforcing loop called “Under the Spotlight.”
Brand trust also plays an external role, helping establish a stronger brand identity and
brand image. As brand image strengthens, the organization’ s relevance increases in the eyes of
its customers and this helps the organization become more differentiated it the market place. As
22
differentiation increases, brand recognition is enhanced, resulting in turn in an increase in brand
trust. Finally, brand trust positively influences brand equity which in this causal loop diagram,
positively impacts brand image and differentiation, thereby enhancing the “Positioning Power”
loop that was just discussed.
Although not shown above, the greater an organization's ability is to differentiate itself
effectively from its competitors, the less impact the exogenous variable “NGO scandals” is likely
to have on brand trust. Study participants lament the fact that all NGOs are “lumped together”
and this is why a scandal at one NGO can impact the brand trust of another. If that other NGO is
sufficiently differentiated from the first, the negative impact of the scandal on brand trust will be
considerably lessened.
Diagram 9
Final Causal Loop Diagram - Partnerships
+ Differentiation
ee
sr
3 + Customer
Experience
Operational focus
>
‘— Consistency in
operations and ne?
eing 1) Visibility
+ Power of Positive Association
+ Recognition
Brand tush
In this final causal loop for Partnerships (see Diagram 9), two reinforcing loops and one
balancing loop exist. The first of the reinforcing loops in the “Relevance loop” which highlight
the reinforcing relationship between partnerships and relevance. In essence, the more good
partnerships an organization has, the more relevant it becomes and the more relevant it is the
more partnerships it attracts.
In the second reinforcing loop, the “Power of Positive Association loop,” partnerships
play a positive role enhancing brand image, which increases credibility. An increase in
credibility results in a positive customer experience and enhances visibility. In addition,
partnerships also help in differentiating an organization which also enhances visibility. Increased
visibility results in higher recognition which drives up brand trust. Brand trust boosts
organizational legitimacy which helps attract partnerships.
23
Partnerships also positively impact funds raised which as we have seen already in
previous causal loops, results in organizational growth and a decrease in operational focus. As
focus declines, so too do consistency, program quality and organizational integrity. This
negatively impacts brand trust, organizational legitimacy and partnerships, as shown in the
balancing loop called “Mission Drift.” Finally, brand equity is enhanced by good partnerships
and in turn positively impacts: partnerships; fund raised; brand trust and differentiation. In this
way brand equity plays a role enhancing all three loops.
Conclusion
The stated objective of this research was to model brand equity for international nonprofit
organizations engaged in development, advocacy and relief. The expectation was that this model
would shed light on the key managerial and contextual variables that drive brand equity for these
organizations, and how they interact. The four final causal loops depicted and described above
(Consistency, Focus, Trust, and Partnerships) form the core of the proposed model of brand
equity in international nonprofit organizations. For clarity purpose, we did not show in the text
the final integrated model combining the four main causal loops. The full model captures the
complexity and simultaneity of their inter-relationships as well as the nature of their systemic
links to other pertinent variables (as captured in the four final causal loops above). As such, this
research constitutes a significant step in advancing our understanding of brand equity in
nonprofits through modeling.
More precisely, this research results in two principal contributions: 1) An explicit set of
principles and guidelines for nonprofit managers and marketing academics alike, drawn from the
brand equity model just derived; and 2) The demonstration of the effective use of system
dynamics in the field of marketing, particularly in the critical domain of branding and brand
management. On the basis of this model captured in the four final causal loops, we propose 11
specific recommendations for international nonprofit brand managers. These are summarized in
Table 7 and outlined below.
Had this research used a more traditional approach to theory building consisting only of
interviews of case studies using semi-structured questions (Eisenhardt 1989), we would have
come to the conclusion that seven variables drive brand equity: Focus, Consistency, Partnerships,
Awareness, Trust, Globalness, and Distinctiveness. These conclusions would not be wrong per
se. Indeed, they include the four key variables of the proposed brand equity model of this study,
but we have no additional insights into what drives these variables or how they interact. It is only
by developing causal loops for each key variable, and validating these in the field, that we can
gain these additional insights. The use of system dynamics tools such as causal loops can help
researchers more profoundly understand the nature of key variables, for example the three
dimensions of consistency, as well as identify the managerial and contextual variables that
influence key variables. The role of organizational integrity, for example, becomes apparent,
both in terms of a product and input of consistency but also as a key variable for building brand
trust. And the role of brand trust itself, as a driver of Partnerships, Focus and Consistency is
captured in the final causal loops that make up the heart of this brand equity model for
international nonprofit organizations.
24
Table7
Recommendations to International Nonprofit Brand Managers
For Building and Managing Brand Equity
FOR CONSISTENCY
1) Increase internal coordination in order to enhance consistency throughout the
organization and between operations and messaging
2) Concentrate external messaging efforts to increase communication consistency
FOR FOCUS
3) Strive for operational focus despite the pressures of growth and fundraising
4) Stick closely to the mission
FOR TRUST
5) Endeavor to differentiate the organization through strong brand positioning
6) Raise visibility and recognition through messaging and presence in the field
7) Promote organizational integrity through workshops as well as the implementation of
standards and best practices
FOR PARTNERSHIPS
8) Select partners that provide the best fit with organizational values and activities
9)Proactively manage relationships and the portfolio of relationships
INTERNAL BRANDING
10) Recognize and embrace the powerful internal role of the brand and promote the brand
to internal audiences
11) Encourage internal brand ambassadors
While this study has led to some key finding and contributions, it is also important to
recognize the limitations of this work and to identify future research needs. The limitations of
this study fall into two main categories: 1) Issues of replicability of the research and 2) Issues of
applicability or generalizability of the model itself.
Concerns with the replicability of the research occurred at two levels: a) Focus group
structure and participation; and b) Interpretation of data and application of constant comparison.
In the former, bias is introduced by the existence of different personalities and hierarchical
reporting structures within the focus groups. In phase two, worksheets were introduced to enable
more balanced and broader participation. In the latter, researchers’ expectations and prior
experience may have shaped the interpretation of the data, thereby influencing the categories that
arose. Concerns with applicability exist with respect to whether the proposed brand equity
model, based on only three case studies, is generalizable to other international nonprofit
organizations and domestic nonprofits.
We suggest three areas of future research linked to this study: 1) Finalizing and refining
the existing model; 2) Validating and assessing the generalizablity of the model; and 3)
Expanding on the model. In the first area, a simulation model based on the causal loops could be
completed and tested for validity with the original case studies. In fact, we did extend the study
and run a simulation using the Vensim simulation software for the final causal loop of “Trust”
(the description of the simulation, mathematical model, and results go beyond the scope of the
current paper). In the second area, the model could be tested with new intemational nonprofit
25
organizations as well as domestic nonprofits to ascertain generalizability. Finally, different brand
audiences might be interviewed and polled to understand how and to what extent different brand
audiences influence brand equity. Overall, we hope that the detailed account of the process of
our model building constitutes sound material for replication of this type of study and a source of
inspiration in the field of marketing which has traditionally shied away from considering system
dynamics in many of its research domains.
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