Why the family business brand matters: Brand authenticity and the family firm trust inference

Journal of Business Research 89 (2018) 121–134

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Journal of Business Research journal homepage: www.elsevier.com/locate/jbusres

Why the family business brand matters: Brand authenticity and the family firm trust inference Maximilian Lude

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, Reinhard Prügl1

FIF at Zeppelin University, Am Seemooser Horn 20, 88045 Friedrichshafen, Germany

A R T I C LE I N FO

A B S T R A C T

Keywords: Consumer behavior Brand trust Brand authenticity Family business brand Inference theory Family firm Purchase intention

Studying branding strategies of family firms gives rise to a striking observation: an increasing number of family firms nowadays communicate the “family” nature of their organizations. We therefore see a need for controlled empirical tests to determine whether this strategy of using a family business brand does influence consumers brand perceptions. Drawing on inference theory, we test the influence of a family business brand on perceptual and intentional variables in a series of two experimental online studies (N = 382; N = 126) and one field experiment (N = 54). The findings reveal that consumers infer higher brand trust from the communication of the firm's family nature, resulting in stronger purchase intentions. Furthermore, we identify brand authenticity as mediating variable for the family firm trust inference: consumers perceive brands that communicate their family nature as more authentic, leading to higher brand trust, and thus revealing brand authenticity as cognitive process of the family firm trust inference.

1. Introduction Research on family businesses, which is itself a field that actively integrates different disciplinary perspectives, has so far examined a broad variety of topics ranging from financial performance (e.g., Chrisman, Sharma, & Taggar, 2007; Kim & Gao, 2013), governance (e.g., Brenes, Madrigal, & Requena, 2011; Jaskiewicz & Klein, 2007), conflict (e.g., Kellermanns & Eddleston, 2007), succession (Chen, Liu, Yang, & Chen, 2016), and entrepreneurship and internationalization (e.g., Carr & Sequeira, 2007; Kraus, Mensching, Calabrò, Cheng, & Filser, 2016). Recently, innovation (e.g., Hauck & Prügl, 2015; Kraiczy, Hack, & Kellermanns, 2014) and especially marketing (e.g., Binz, Hair, Pieper, & Baldauf, 2013; Gallucci, Santulli, & Calabrò, 2015; Zellweger, Kellermanns, Eddleston, & Memili, 2012), and combinations of those two “hot topics” in family business research (Covin, Eggers, Kraus, Cheng, & Chang, 2016) seem to have attracted a great deal of attention. One important reason for the increased interest in marketing in the context of family firms might be the following: Family firms are the dominant form of business organizations all over the world and have a massive impact on the economy as a whole (Astrachan & Shanker, 2003; Poza, 2013; Shanker & Astrachan, 1996; Weidenbaum, 1996), while most of the time consumers are not aware of the “family nature” of those firms. This reveals an untapped potential to leverage that characteristic for differentiation purposes in a “hypercompetitive”

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world. Accordingly, some family firms have started to invest heavily in promoting their family nature. Take, for example, SC Johnson. As a pioneer of this branding strategy, the company has for years included its tag “SC Johnson: A Family Company” prominently in ads for brands such as Windex, Ziploc, Pledge and others. On the other hand, many other family companies, while similarly dependent on brand trust for their products to be bought, do not market their family nature, thus acting more like a non-family firm (e.g., Mars Inc., which is still privately held by the founding family). More and more family companies, however, advertise explicitly that they are “family firms”. This can be observed in many categories and different geographical contexts, such as beverages (Glenfiddich, United Kingdom: “Family run since 1887”; Warsteiner, Germany: “Family tradition since 1753”), food (El Monterey, United States: “Family owned since 1964”; Foster Farms, United States: “Family owned since 1939”), and manufacturing (Heinz Glas, Germany, “Family owned since 1622”), to name just a few. This gives rise to the question: Why is that the case? What do consumers actually infer from the informational cue “family firm”? In our attempt to shed light on this question, we define a family business brand as “the formal and informal communication (image) of the family element of firm essence (identity), which includes the family's involvement in a firm, and which lead to associations and expectations in the mind of stakeholders (reputation) that help differentiate these firms from others in the marketplace and other venues”

Corresponding author. E-mail addresses: [email protected] (M. Lude), [email protected] (R. Prügl). Both corresponded equally.

https://doi.org/10.1016/j.jbusres.2018.03.040 Received 7 September 2016; Received in revised form 29 March 2018; Accepted 30 March 2018 0148-2963/ © 2018 Elsevier Inc. All rights reserved.

Journal of Business Research 89 (2018) 121–134

M. Lude, R. Prügl

Fig. 1. Conceptual model and overview of studies.

demanding consumers (Knox, 2004), the value brands deliver to consumers is becoming more and more important. Whereas it has been shown that family firms have advantages and disadvantages regarding internally focused business activities, such as financial issues and performance (e.g., Chrisman et al., 2007; Kim & Gao, 2013), succession and innovation behavior (e.g., Chen et al.,2016; Hauck & Prügl, 2015), only little research has examined whether family firms also acquire advantages or disadvantages over non-family firms in terms of consumer perceptions and consumer behavior. This is surprising given that Tagiuri and Davis (1996) published their work on the bivalent attributes of family firms over two decades ago; even at that time, they mentioned that the family signal also holds meaning for people outside the company. Those authors note that “company outsiders” (i.e., external stakeholders) infer certain characteristics from the family nature of a firm and thus ascribe a certain behavior to that firm (Tagiuri & Davis, 1996). For our purposes, we focus on how one specific and very important stakeholder group processes the informational cue “family firm”: the (potential) consumers of the firm's products.

(Binz Astrachan, Botero, Astrachan, & Prügl, 2018, p.3). In this paper we more explicitly focus on the reputational effects of a formal communication (image) of the family business brand on (potential) consumers, i.e. a branding effort in which the family nature of the firm is consciously signaled in the brand's appearance, that is, throughout the entire interaction between a brand and its (potential) consumers. As we see a need to test for the existence of the effect of a “family business brand” on consumers' brand perceptions in a controlled empirical environment, we aim to assess whether the family nature of a firm has a positive effect on brand trust and purchase intention. We then examine whether brand authenticity mediates the positive effect. We thereby manipulated whether the same product is presented to consumers with (vs. without) signaling the family nature of the firm. Accordingly, the overall objective of this paper is to investigate whether, how and why the perception of the family nature of a brand does influence relevant perceptional and intentional variables (see Fig. 1 for conceptual model). Drawing on inference theory, we add to recent research on signals or cues that affect consumer preferences (e.g., Basuroy, Desai, & Talukdar, 2006). Our findings, which are based on two experimental online studies and one field experiment, have important implications for theory and practice. From a theoretical perspective, we confirm that the mere presence of a family business brand cue can trigger trust inferences, which subsequently impact consumers' purchase intentions (Study 1). We also demonstrate the mediating role of brand authenticity in trust inferences regarding family business brands (Study 2), showing preliminary evidence for the cognitive process driving the effect of a family business brand. From a managerial perspective, we provide practitioners with empirically based recommendations for incorporating a family business cue in their brand communications. This is important, as many brand owners in various product categories highlight the family nature of the firm in advertising, product packaging, promotional displays, websites and other forms of promotion. In particular, we discuss how to (or not to) promote a brand's family nature in marketing communications, and we address the consequences of this branding strategy.

2.2. Informational cue processing and consumer inference theory When consumers are confronted with a brand, they are exposed to a variety of informational cues on which they form their opinions and brand evaluations. These cues can be differentiated into intrinsic information cues (e.g., look, sound, smell, taste), which directly affect the products' appearance and performance, and extrinsic information cues (e.g., brand, price, country of origin), which do not directly affect the products' appearance and performance (Szybillo & Jacoby, 1974). According to cue utilization theory, when intrinsic cues are inaccessible (e.g., because no prior purchase experience or attribute information is available), consumers are compelled to rely heavily on extrinsic cues for their evaluations and decisions (Bredahl, 2004; Magnusson, Westjohn, & Zdravkovic, 2011). In other words, extrinsic cues “can provide a cognitive shortcut when intrinsic cues are difficult to obtain, the motivation to understand intrinsic cues is lacking, or the consumer seeks to expedite the decision process” (Magnusson & Westjohn, 2011, p. 292). Our study draws on the well-established consumer inference theory proposed by Kardes (Kardes, 1993; Kardes, Posavac, & Cronley, 2004; Kardes, Posavac, Cronley, & Herr, 2008) to build an understanding of how consumers react to family business branding cues. Kardes' theory highlights that multiple cues are likely to be present in organizational communications and addresses the way in which new consumers are likely to make use of those cues to draw inferences about the nature of the organization. Potential consumers do not have all relevant information at hand to make a decision about, or an evaluation of, a product or service. Instead, they must rely on whatever cues are available. Advertisements typically provide informational cues about certain product attributes and benefits. However, other product

2. Conceptual background 2.1. Previous family firm research Like any other type of company, the primary objective of a family firm is to successfully sell its products or services on the market and thus strengthen its position in the competitive environment. To reach that goal, marketers make continuous efforts to create strong brands, which in turn help them to achieve higher margins and better customer response to their communications efforts (Gill & Dawra, 2010). In a world of growing competition, accelerated innovation, and increasingly 122

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According to Chua, Chrisman, and Sharma (1999), a family firm is “a business governed and […] managed with the intention to shape and pursue the vision of the business held by a dominant coalition controlled by members of the same family or a small number of families in a manner that is potentially sustainable across generations of the family or families” (p. 25). The uniqueness of family firms arises from the integration of family and business (Habbershon & Williams, 1999). This integration creates several salient and unique characteristics. Family firms are shown to be very long-term oriented (e.g., Breton-Miller & Miller, 2006), for example in establishing trustful relations with employees and other stakeholders. At the same time family firms act in a particularistic manner that follows from the personalization of authority and stems from the tendency of the owner–managers to view the firm as “their business”. This allows for uniqueness in decision-making (e.g., Carney, 2005). In essence, family firms strive for stability and long-term survival by investing in trustful long-term relationships. At the same time, thanks to family control, these firms have the degrees of freedom necessary for unique and particularistic decisions in order to achieve the goal of survival over generations. Both concepts (family and family firm) clearly emphasize long-term stability through trustful relations, while at the same time allowing for or at least accepting - individual, unique and thus authentic behavior. The next question relates to the way in which these concepts are viewed from the outside: Which attributes do consumers infer from the term “family firm”? While the marketing literature has so far remained silent on this topic, a closer look into the field of family business research reveals that a few recent studies have investigated the general topic of how consumers perceive family firms, revealing primarily positive associations (Beck & Kenning, 2015; Binz et al., 2013; Carrigan & Buckley, 2008; Orth & Green, 2009). In their literature review regarding the image and reputation of family firms, Sageder, Mitter, and Feldbauer-Durstmüller (2018) indicate that only a small fraction of publications focused on stakeholders' associations with family firms. However, the few studies available so far have reported that family firms are mainly regarded as trustworthy (Beck & Kenning, 2015; Binz et al., 2013; Blodgett, Dumas, & Zanzi, 2011; Carrigan & Buckley, 2008) and socially responsible (Binz et al., 2013; Carrigan & Buckley, 2008; Covin, 1994). Recently, initial attempts have been made to provide some deeper insight into the perception of family firms (Beck & Kenning, 2015; Binz et al., 2013). For instance, Binz et al. (2013) found that promoting the family nature of a firm increases consumers' preference for the products and services offered, which, according to those authors, can be explained by the relational qualities consumers associate with family firms. Furthermore, the findings regarding the perception of family firms indicate that trust can be initially identified as the most central association (e.g., Beck & Kenning, 2015; Binz et al., 2013; Carrigan & Buckley, 2008; Krappe, Goutas, & von Schlippe, 2011; Orth & Green, 2009). However, almost none of the extant research on trust as a characteristic associated with family firms has used a controlled experimental design2 to fully understand whether there is a causal relationship between a single cue (family firm) and an increase in trust or other trust-related variables. According to Wang, Beatty, and Foxx (2004), trust can be conceptualized as either experience-based or cue-based. Experience-based trust is acquired via repeated interactions, whereas cue-based trust is founded on cues received from a single encounter (e.g., a website or an advertising message). In cases where no prior consumption experiences or other interactions have taken place, consumers draw inferences about the trustworthiness of a product based on intangible informational cues or signals. Information on the family nature of a brand is a

features that may be considered important to the purchase decision (e.g., the trustworthiness of the company) must be inferred by the potential consumers, essentially by going beyond the information available (Kardes et al., 2004). Inference formation thus involves the generation of “if-then” linkages between the available information (e.g., cues) and relevant conclusions (Kardes et al., 2004, 2008). There are several types of inference formation depending on the context in which consumers face a situation with limited information (see Kardes et al., 2004). Here we focus on memory-based singular inferences, more precisely on correlation-based inferences (Kardes et al., 2004)). This process is memory-based because consumers make use of prior beliefs concerning the correlation between a specific cue and the overall judgement of the object (Kardes et al., 2004). In general, inference-making is important as a means of explaining and predicting consumer behavior (Broniarczyk & Alba, 1994). Therefore, the consideration of which brand information can lead to positive or negative consumer inferences should be a central one for both researchers and marketing managers. As discussed above, we argue that the informational cue “family firm” might evoke such (positive or negative) memory-based inferences, which in turn support attitude formation toward the respective brand. In this way, it is possible for potential consumers to rely on familiar cues before other judgement-relevant cues are processed (Bodenhausen & Lichtenstein, 1987; Li & Wyer, 1994). Therefore, the family nature of the firm is most likely to be used as a basis for evaluating the (unknown) brand of the company, since “family firm” is a familiar term and typically has judgement-relevant attributes. In the following, we begin by briefly clarifying a number of central concepts, i.e., what we know about “family” and “family firms”, as different consumer perceptions of the family nature of a firm must be closely related to the perceptions, meanings and expectations that lie in these two terms. 2.3. Conceptualizing the family nature of the firm: integrating family research and family business research The family is said to be the “most important and enduring of all human social groupings” (Smith, Hamon, Ingoldsby, & Miller, 2009, p. 5). Families have a large and undeniable impact on human behavior. Baxter and Braithwaite (2006) define families as groups “of two or more persons, characterized by ongoing interdependence with longterm commitments that stem from blood, law, or affection” (p. 3). “Family” is given prominent status all over the world. Even in individualistic cultures such as American culture (e.g., Bellah, Madsen, Sullivan, Swidler, & Tipton, 1985; Weiss, 1969), the family unit has a dominant status in everyday life. However, its dominance comes not from the preservation of the traditional nuclear family or from any broad consensus or definition of the family unit. Instead, people define for themselves what “family” means and who is included in their family group (Bengtson, 2001). Nevertheless, there is a strong overall sense of belonging (“unquestioned belonging”) along with loyalty to members of one's birth family (Ellingsen, Stephens, & Størksen, 2012). Research suggests that children and adolescents generally seem to have an openminded and inclusive understanding of “family” (Anyan & Pryor, 2002; Rigg & Pryor, 2007), in which love, care, and support are primary criteria in well-functioning families (Anyan & Pryor, 2002). In addition, Huisman (2014) finds that families combine closeness and individual authenticity: They persevere, meaning that they are able to overcome obstacles and challenges within the family, while at the same time each family is seen as an island, that is, emphasis is placed on the uniqueness of every single family. In essence, family is characterized by trustful relations where every member can be how she is, and individuality and authentic behavior do not call a member's belonging into question. Family membership lasts a lifetime (exclusion is almost impossible) and is a very rare and unique thing at the same time (on average, we have just one family). For a more complete understanding, we will now have a look at the concept of the family firm.

2 Methods that have been applied include: online survey (Beck & Kenning, 2015), standardized questionnaires (Binz et al., 2013); in-depth interviews (Carrigan & Buckley, 2008); Nextexpertizer (Krappe et al., 2011); or one-page scenarios (Orth & Green, 2009).

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have their roots in the perception of the brand (Aaker, Vohs, & Mogilner, 2010; Biel, 1992). As previous research has shown that confidence in brands is an important antecedent of purchase intentions (Laroche et al., 1996), we aim to confirm this finding within the context of the effect of a family business brand. Therefore, we expect favorable inferences regarding brand trust to increase consumers' intention to purchase products from brands that emphasize the family nature of the firm. We therefore hypothesize the following:

potential source of such informational cues, as consumers who lack personal experience of a certain product are likely to draw inferences about the brand's trustworthiness from past experiences with brands in the same category (family firms). In the absence of such experience, the customer may consciously or unconsciously draw on their own family experience (as an important informational cue inherent to the family business brand). Transferring this to our inference argument, we thus propose a perceived correlation between the explicit communication of the family nature of a firm and trust, which might provide a basis for an effective family firm trust inference. In this context, we identify a strong need for a branding research perspective in order to test empirically whether the simple informational cue “family firm” placed on a product or brand logo is a judgement-relevant feature differentiating family firms. To do so, we draw on inference theory and apply experimental research methods to demonstrate causal relationships as well as to empirically examine the underlying cognitive processes explaining why these causal relationships may exist.

Hypothesis 2. Purchase intention is greater for brands with a family firm cue than for brands with no family firm cue. The effect of a family firm cue on purchase intention is mediated by brand trust. 3.2. The mediating role of brand authenticity As elucidated in the conceptual background to our research, we also aim to explore the cognitive process behind the family firm trust inference. The fact that a family has run a company successfully for decades is supposed to convey to consumers a sense of honesty and authenticity (Tasman-Jones, 2015; interview with Paul Bailey, creative director of 1977 Design), which in turn is an important driver of trust development (Garbarino & Johnson, 1999). This led us to explore the construct of brand authenticity. Among other authors, Moulard, Raggio, and Folse (2016, p. 423) define brand authenticity as “the extent to which consumers perceive that a brand's managers are intrinsically motivated in that they are passionate about and devoted to providing their products”. The authors base their conceptualization on self-determination theory (Ryan & Deci, 2000), which describes intrinsically motivated behavior as being the epicenter of authentic actions. Interestingly, this conceptualization is also mirrored and pursued by Holt (2002, p. 82), who writes “to be authentic, brands must be disinterested; they must be perceived as invented and disseminated by parties without an instrumental economic agenda, by people who are intrinsically motivated by their inherent value.” Combining this with what we know about family firms, that is, value-driven, and long-term oriented enterprises whose managers are self-determined and thus intrinsically motivated, brand authenticity appears suitable to explain the family firm trust inference. To investigate the concept of brand authenticity in more detail, we examine the antecedents of brand authenticity. Recently, it has been found that stability and rarity are the two major antecedents of brand authenticity (Moulard et al., 2016; Moulard, Garrity, & Rice, 2015). Rarity can be defined as a behavior unique to the brand, with uniqueness referring to “the extent to which consumers perceive that a brand is unusual or atypical compared to the competition” (Moulard et al., 2016, p. 424). As we know from family business research, individuals perceive the family firm as a “unique entity within the business environment” (Carrigan & Buckley, 2008, p. 664), an image which mainly originates from the perceived intertwining of the owner and the business and thus the owner's high involvement in the business (ibid.). Uniqueness is also mirrored in family firms' decision-making and behavior (Carney, 2005) due to the central influence of family members in the firm based on ownership stakes and top management positions. At the same time, families perceive themselves as unique entities, as a recent study shows (Huisman, 2014). Focusing on the second antecedent (stability), the literature provides two specific manifestations: longitudinal consistency and longevity (Moulard et al., 2016). Especially the latter one, defined as “the extent to which consumers perceive that the brand has been in existence for a long period of time” (ibid., p. 425), shows significant analogies to the perception of family businesses. Krappe et al. (2011) conclude that family firms are perceived as persistent and stable, which is a consequence of their long-term orientation and rich tradition. Having a rich tradition represents the family's continuity within the business (Micelotta & Raynard, 2011), which underpins the longevity dimension. But why are family firms said to be long-term oriented?

3. Development of hypotheses 3.1. The family nature of the firm, brand trust, and purchase intention Brand trust is a widely accepted construct and, based on our review of family and family business research, the central construct of our research. To define brand trust, we rely on the definition provided by Herbst, Finkel, Allan, and Fitzsimons (2012): “consumers' confidence that the brand, product, or service firm is dependable and competent” (p. 910). This definition integrates numerous perspectives on brand trust (Chaudhuri & Holbrook, 2001; Doney & Cannon, 1997; McAllister, 1995; Moorman, Deshpande, & Zaltman, 1993; Morgan & Hunt, 1994; Sirdeshmukh, Singh, & Sabol, 2002) and therefore meets our requirements best. Marketing scholars agree that brand trust is an essential component in building successful relationships between a company and its consumers (e.g., Morgan & Hunt, 1994). Therefore, building a strongly trusted brand should be among the priority goals of marketers. Of course, this is independent of the nature of the company, but some enterprise types may have an edge over others (e.g., firms that communicate their family nature or their country of origin). In order to encourage trust in a brand, relevant cues have to be integrated into the brand's appearance. Most of these cues are ambiguous and therefore require the consumers' interpretation, which refers back to the inference logic described above. More precisely, consumers have to interpret whether the cue presented on the brand is evidence of trustworthiness or untrustworthiness (Herbst et al., 2012). As mentioned in our discussion of the conceptual background, family research portrays families as places where trustful relations enable members to thrive. With regard to family businesses, a potential trust advantage for family firms is also initially mirrored in existing research (e.g., Beck & Kenning, 2015; Binz et al., 2013; Carrigan & Buckley, 2008; Orth & Green, 2009) as well as in the Edelman Trust Barometer, an annual global study on the formation of institutional trust in societies. The study's results regarding enterprise type reveal an institutional trust advantage for family-owned firms in developed countries (U.S., U.K., Germany, France, Japan; Edelman Trust Barometer, 2015). Relying on these preliminary findings, we argue that the “family firm” cue can serve as a relevant trigger for trust formation and is thus able to increase brand trust in the minds of (potential) consumers. Formally, Hypothesis 1. Consumers' brand trust is greater for brands with a family firm cue than for brands with no family firm cue. Why should the perception of a brand be important to managers? In order to address this question, we chose a prominent construct of consumer behavior: purchase intention (Laroche, Kim, & Zhou, 1996). We argue that brand perceptions might affect the consumers' purchase intentions because the behavioral intentions of consumers apparently 124

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Research on family firms indicates that the reason lies in their focus on transgenerational survival (Chua et al., 1999), which is reflected in their decision-making and observable in comparably long CEO tenures (Boling, Pieper, & Covin, 2015), to name one example. While this is directly observable only in part for the consumer, past experience with different family firms or knowledge about this specific type of firm may also trigger stability perceptions. At the same time, we know from family research that the family is perceived as a constant in life, providing stability for its members. This is quite straightforward: membership in a family lasts a lifetime. Therefore, on the basis of the arguments from (1) family firm research and (2) family research presented above, we hypothesize that consumers associate higher levels of brand authenticity with firms that communicate their family nature, as we expect both informational cues (family firm and family) to trigger perceptions of stability and uniqueness in the minds of consumers. This explains why consumers infer higher levels of trust from firms that display a family business brand. In sum, we hypothesize the following:

to test whether the additional information provided in conditions A and B had an effect on the dependent variables and thus biased the results. We decided to use the context of the beverage industry, which is in line with recent research in top-tier marketing journals (e.g., Melnyk, Klein, & Völckner, 2012; Puzakova, Kwak, & Rocereto, 2013). Within this context, we decided to use a product with a comparably high brand-relevance level (i.e., the relevance level of a brand in a buying situation). To this end, we conducted a pretest (student sample, N = 40, Mage = 26.9 years, female = 50%) in which we asked the participants to rate the relevance of a brand in the buying decision for nine products in the beverage industry (sparkling water, coffee, wine, sparkling wine, juice, lemonade, smoothies, beer, and liquors). The results revealed that sparkling wine consistently received the highest scores concerning brand relevance. Based on this result, we used sparkling wine to test the main effect (H1 and H2). In collaboration with a professional graphic designer, we created the fictitious brand “Brut Bonnet” for our experiment (see Fig. S1). We collected data via an online consumer panel based in Germany (SoSciSurvey). This non-commercial panel provider offers a well-structured respondent pool of over 93,000 consumers from Germany, Austria and Switzerland, all of them with relatively high levels of education. In our study, we used the entire population provided by the consumer panel. Participants were invited via e-mail and incentivized by the chance to win Amazon vouchers. We included several control questions to fully guarantee that respondents understood the stimuli as intended and answered the survey conscientiously. First, we asked the participants whether they knew the brand presented in order to exclude potential biases concerning the fictitious brand. Second, we asked the participants to select what kind of product the stimulus showed. Participants had to choose between seven options. On that basis, we excluded some of the respondents, reaching a final sample size of 382 (Mage = 39.8 years, range: 16–79 years, 50.3% female).

Hypothesis 3. Brand authenticity is greater for brands with a family firm cue than for brands with no family firm cue. Hypothesis 4. The positive effect of the family firm cue on brand trust is mediated by brand authenticity.

4. Overview of studies In order to test the hypotheses incorporated into our conceptual model (see Fig. 1), we conducted three different experimental studies. The objective of Study 1 was to test the main effect of signaling family nature of a company on brand trust and purchase intention, whereas Study 2 investigated whether brand authenticity could be identified as a driver of the main effect on brand trust. Both experimental studies were conducted as online experiments and incorporated different product categories as stimuli in order to guarantee greater robustness in the findings. Study 3 was designed to confirm the findings from our online experiments in a field setting in order to increase external validity and to test the effect of a family business brand in a choice situation.

4.1.2. Measures To capture brand trust, we exposed the participants to eleven items adopted from Herbst et al. (2012), and for purchase intention we used the well-established single-item scale developed by Coulter and Coulter (2005). We are aware of the ongoing discussion concerning the use of single-item measures in marketing and consumer behavior research. Nevertheless, these scales are well established in marketing research, and it has been shown that single-item scales can be highly valid and reliable (Bergkvist & Rossiter, 2007; Fuchs & Diamantopoulos, 2009; Wanous, Reichers, & Hudy, 1997). In addition, we included two variables to control for confounding effects in order to extract a purer effect from our main manipulation (communicating the family nature of a firm). First, we used product class involvement (PCI) as proposed by Mittal (1995) to measure the respondents' involvement in the respective products on a three-item scale. We expect that if individual respondents' PCI is higher, they will have a lower need or dependence on more general attributes because their knowledge about specific product attributes is higher. (See Table 2) Second, we included a six-item emotional cohesion part of the family climate scale (FC) from Björnberg and Nicholson (2007) with the objective of controlling whether individual family cohesion confounds the perception of brands that communicate their family nature. In this regard, we argue that if FC is higher, the perception of family as the central element in a family business brand is likely to be more favorable. That is why we see a need to control for the respondents' experience with the concept of family. For all constructs, we tested for convergent validity using average variance extracted (AVE), indicating

4.1. Study 1 4.1.1. Method To test our formal hypotheses concerning the increased brand trust and purchase intention triggered by family firm information, we used a between-subject design applying a broadly accepted method in consumer behavior research (e.g., Biswas, 2009; Romero & Biswas, 2016). In Study 1, we test whether presenting a brand as a family firm changes the degree of trust formation toward the brand and has an indirect effect on purchase intention. Thus, Study 1 tests H1 and H2. The experimental study was designed as follows: We created three experimental conditions, all of which displayed a fictitious brand by showing a product and a brand logo. The first condition (A) was manipulated as a family firm by adding the tagline “A family company” to the brand logo presented. The second (B) and third condition (C) represented the regular (non-family) firm conditions, that is, with no tagline in the logo. Below the product photo, the first two conditions (A and B) both provided brief information regarding the launch of a new product by the family firm (vs. the regular firm). To control for a simple “more information is better” effect (Russo, 1974), we included the third condition (C), which represented our baseline condition and only presented the product and logo without any additional product information below the photo. By including the third condition (C), we were able

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Relying on this first indication, we conducted further mediation analyses using bootstrapping methods with bias-corrected confidence estimates (MacKinnon, Lockwood, & Williams, 2004; Preacher & Hayes, 2004) based on 95% confidence intervals and 5000 bootstrap resamples (Preacher & Hayes, 2008). We used a model with the family cue (no family cue coded as −1; family cue coded as 1) as the independent variable, purchase intention as the dependent variable, and brand trust as the mediating variable. As predicted, the results of the mediation analysis provide further evidence that the effect on purchase intention is mediated by brand trust (indirect effect: 0.15; 95% confidence interval [CI]: 0.03 < CI < 0.26). As zero is not included in the confidence interval, the indirect effect is significantly different from zero at p < 0.05, thus supporting H2. Because the direct effect of the family cue on purchase intention is still significant (direct effect: 0.25; p < 0.01) when we control for brand trust, our results suggest partial mediation. To verify the robustness of the results, we added relevant control variables (family cohesion [FC] and product class involvement [PCI]) as covariates to the model. Neither of those variables showed significant relationships with brand trust (p values > 0.05) or purchase intention (p values > 0.05). In controlling for FC and PCI, we confirmed our identification of brand trust as a mediating variable.

values above the threshold of 0.50 (Hair, Ringle, & Sarstedt, 2011; see Table 2). Additionally, all constructs support discriminant validity based on the Fornell-Larcker criterion, as the square roots of the AVE values are higher than all inter-construct correlations (Hair et al., 2011; see Table 3).

4.2. Study 2 4.2.1. Method As Study 1 demonstrated that signaling the family nature of a firm has an effect on purchase intention mediated by brand trust, the aim of Study 2 is to explore the cognitive process that takes place behind the effect on brand trust. We therefore test whether brand authenticity can be identified as an explanation of the family firm trust inference found in Study 1. Furthermore, Study 2 also tests whether the positive effect of a family business brand from Study 1 holds true for a different product category. Again, we conducted an experimental study with a between-subject design using a fictitious brand called “Oliviera”, a cosmetic company that plans to launch a new body wash with natural olive oil. In this study, we created two experimental conditions, both showing the product, a brand logo, as well as a short text informing the participants about the launch of the product presented. As in Study 1, we manipulated the communication of the family nature by including the tagline “a family company” in the brand logo in the first condition. In order to control for confounding effects based on the mere existence of a tagline in the logo, we also included the neutral tagline “cosmetics” in the brand logo in the second condition (see Fig. S2).

4.00

4.00

3.80

3.80

Purchase Intenon (1-7)

Brand Trust (1-7)

4.1.3. Results Before analyzing the intended main effect of the family firm cue on dependent variables, we first tested whether the ratings of all dependent variables differed between the regular firm condition and the baseline condition (i.e., no product briefing). Several t-tests showed a non-significant effect for brand trust (Mnonfamily = 3.61; Mbaseline = 3.59; t = 0.17, p = 0.86) and purchase intention (Mnonfamily = 3.04; Mbaseline = 2.90; t = 0.71, p = 0.48). This constitutes an important finding since it implies that more information alone did not produce any effects compared to the baseline condition. We then conducted one-way ANOVAs with communicating the family nature of a firm (family business brand cue vs. regular firm vs. baseline condition) as a fixed factor and brand trust as well as purchase intention as dependent variables. In support of H1, our analyses indicate a significant main effect of communicating the family nature on brand trust; F(2, 379) = 4.31, p = 0.01, η2 = 0.02. As predicted, t-tests revealed that participants inferred more brand trust when the brand logo communicated the family nature of the firm (Mfamily = 3.98, SD = 1.18) compared to both the baseline condition (Mbaseline = 3.59, SD = 1.16, t = 2.59; p = 0.01, d = 0.34) and the regular firm condition (Mnonfamily = 3.61, SD = 1.14, t = 2.50, p = 0.01, d = 0.31). These results provide evidence of the existence of a family business effect and support H1: The family nature of a firm generates significantly higher brand trust compared to companies that do not communicate their family nature (see Fig. 2). Next, we found support for H2. There was a significant effect of communicating the family nature of a brand on purchase intention; F (2,379) = 9.03, p < 0.001, η2 = 0.05. The brand presented as a family firm induced significantly greater purchase intention (Mfamily = 3.70, SD = 1.53) than both the baseline condition (Mbaseline = 2.90, SD = 1.52, t = 4.10, p < 0.001, d = 0.52) and the regular firm condition (Mnonfamily = 3.04, SD = 1.66, t = 3.32, p = 0.001, d = 0.41). When brand trust was added as a covariate to the model, the effect of a family business brand on purchase intention remained significant (p < 0.01), and highly significant effects of brand trust (p < 0.001) on purchase intention appeared. This result is a first indication that the effect of communicating the family nature of a firm on purchase intention is at least partially mediated by brand trust.

3.60 3.40 3.20 3.00 2.80

3.60 3.40 3.20 3.00 2.80

2.60

2.60 Family Nature of the Firm

Regular Brand

Baseline

Family Nature of Regular Brand the Firm

Fig. 2. Overview of Findings (Study 1).

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for brands that do not (Mbaseline = 4.14, SD = 0.55; t(111.7) = 2.49, p = 0.014, d = 1.15). Regarding brand authenticity, the results also showed strong benefits for brands that communicate their family nature (Mfamily = 4.95, SD = 1.14) compared to the baseline condition in which the family firm background is not mentioned (Mbaseline = 4.32, SD = 0.71; t (121.6) = 3.8, p < 0.001, d = 1.23), which strongly supports H3 (see Fig. 3). In order to check whether brand authenticity explains the effect of a family business brand on brand trust (H4), we used mediation analyses (Preacher & Hayes, 2008) with the family cue manipulation (no family cue coded as −1; family cue coded as 1) as the independent variable, brand trust as the dependent variable, and brand authenticity as the mediating variable. As predicted, the results of the mediation analyses revealed that the positive effect on brand trust is mediated by brand authenticity (indirect effect: 0.21; 95% confidence interval [CI]: 0.10 < CI < 0.33). When we added brand authenticity as the mediating variable, the direct effect of the family cue manipulation on brand trust disappears, indicating full mediation. This finding can even be confirmed at a 99% confidence level (indirect effect: 0.21; 99% confidence interval [CI]: 0.07 < CI < 0.37). As expected, the positive effect of the family cue on brand trust can be explained by the increased brand authenticity of family business brands, which in turn influences trust formation. We also added PCI and FC as control variables to the model. The significant indirect effect remained stable, although PCI showed a significant influence on brand authenticity (ß = 0.11, p < 0.05), meaning that participants with higher product class involvement in cosmetics in general tend to perceive the presented brand as more authentic. See Table 1 for an overview of the findings.

Participants (N = 139) recruited from Clickworker (the German equivalent to Amazon's Mechanical Turk) completed the online experiment in exchange for a small payment. As in Study 1, we included some control questions in order to verify the participants' attention during the survey. Based on those control questions, we excluded outliers and reduced the sample to its final size of 126 participants (Mage = 38.6 years, range: 18–65 years; 47.6% female; all in Germany). As we used a between-subject design, participants were randomly assigned to one of the two conditions and were exposed to the new product from “Oliviera”, which was either presented as a family company or not. 4.2.2. Measures To measure brand authenticity, we used a well-established threeitem scale from Moulard et al. (2016). The items in the scale provided participants with statements like “‘Oliviera’ has a true passion for its business”, asking them how strongly they agreed or disagreed on a seven-point Likert scale. In order to include a manipulation check, we measured family firm perceptions using a family firm image (FFI) scale proposed by Beck and Kenning (2015). This scale measures the degree to which participants perceive the firm as a family firm by means of items such as “For me, ‘Oliviera’ is a family firm”. As in Study 1, we included the same scale from Herbst et al. (2012) to capture brand trust, and we again achieved convergent validity (see Table 2) as well as discriminant validity for all constructs (see Table 4).

4.3. Study 3 4.3.1. Method The primary objective of Study 3 was to verify the findings of the previous online experiments, which clearly point to the existence of the effect of a family business brand, in a near-real field setting in order to enhance the external validity of our findings (Gneezy, 2017). This approach is in line with a recent trend in marketing research (e.g., Ascarza, Iyengar, & Schleicher, 2016; Bart, Stephen, & Sarvary, 2014; Petersen & Kumar, 2015). Our objective was to test whether the communication of the family nature of a firm drives consumers' preference in a more realistic setting in order to confirm the positive effect of the family business brand obtained in Studies 1 and 2. The objective was to create a choice experiment where participants were asked to decide themselves between two products. We used the fictitious brand “Brut Bonnet” (Brand A) as one of the products and created a second brand called “Petulant” (Brand B). We used a pretest (N = 13) to check

5.50

5.50

5.00

5.00

Brand Authencity (1-7)

Brand Trust (1-7)

4.2.3. Results In order to check whether our manipulation concerning the family nature of a firm was processed as intended, we assessed the effectiveness of the family firm manipulation by entering FFI as a dependent variable in an independent t-test with our two conditions (communicating vs. not communicating the family nature of a firm) as a between-participant factor. The results of the t-test revealed significant differences between the family nature condition (Mfamily = 5.11, SD = 1.39) and the baseline condition (Mbaseline = 2.85, SD = 1.20, t (124) = −9.48, p < 0.001, d = 1.7). The condition communicating the family nature of the firm scored significantly higher regarding family firm image, thus confirming our manipulation. Again, as in Study 1, we analyzed whether communicating the family nature of the brand increases brand trust. We used an independent t-test with brand trust as the dependent variable and the family firm manipulation (communicating vs. not communicating the family nature) as the group variable. The results confirmed the findings from Study 1, indicating that participants inferred more brand trust in the case of brands that communicate the family nature of a firm (Mfamily = 4.52, SD = 1.11) than

4.50 4.00 3.50 3.00

4.50 4.00 3.50 3.00

Family Nature of the Firm

Baseline

Family Nature of the Firm

Fig. 3. Results of Study 2. 127

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whether the two brands were perceived similarly before adding the family firm manipulation. To this end, we asked participants to rate their general attitudes toward both brands (MBrutBonnet = 4.9; MPetulant = 5.0) and did not find a significant difference. The participants in the field experiment were 54 potential consumers (Mage = 54.1 years, 48.1% female) randomly selected during face-toface invitations in two mid-size cities in Germany. After being invited to take part in a short market research study, the participants were exposed to a picture showing two different sparkling wine products labeled with the fictitious brands “Brut Bonnet” and “Petulant”. In both product vignettes, the bottle design and product information concerning price, quantity, and country of origin were held constant in order to rule out potential bias due to price or country-oforigin effects. The products were manipulated in terms of the family firm nature. More specifically, participants were informed that one of the two brands was a family firm, which was promoted by a tagline below the brand logo (“A family company”) and a badge in the upper right-hand corner of the vignette (“Family company for three generations”; see Fig. S3). The between-subject treatment (i.e., family cue) was that Brand A (“Brut Bonnet”) was labeled as a family firm and Brand B (“Petulant”) was not, or vice versa (Brand B as family firm and Brand A with no cue). After having been exposed to both vignettes (either Scenario 1 or Scenario 2; see Fig. S3), participants were asked to indicate which of the two sparkling wines they would buy if they needed one (to capture their product choice).

Table 1 Summary of key findings.

Study 1 Brand Trust

Study 2 Brand Trust

Statistics

3.98

3.62

3.59

F(2, 379) = 4.31, p = 0.014, η2 = 0.02 F(2, 379) = 9.03, p < 0.001, η2 = 0.05

4.52

4.14

95% CI: 0.03 < [CI] < 0.26 Statistics

t(111.78) = 2.49, p = 0.014 t(121.67) = 3.80, p < 0.001 95% CI: 0.10 < [CI] < 0.33

5. Discussion Family firms are the dominant organizational form around the world. Highlighting the family nature of a firm started to gain attention as a branding tool increasingly used by marketing practitioners. Understanding the perceptional impact of the informational cue “family firm” has preoccupied academics and family firm managers alike. Following a recent trend in practice, an increasing number of family firms have begun to actively communicate their family nature to outsiders through commercials, product packaging, or websites without having deep knowledge of whether, how and why the informational cue works. In a series of two online experimental studies and one field experiment integrating different product categories, we tested for the existence as well as the cognitive process behind the effect of a family business brand, that is, a positive family firm trust inference triggered by the promotion of the family nature of a firm. Study 1 shows that consumers exhibit stronger purchase intentions for brands that actively promote their family firm nature and that this effect is mediated by an increased level of brand trust. Study 2 further breaks down this effect of a family business brand and illustrates that the positive family firm trust inference is fully mediated by perceived brand authenticity. Consumers perceive brands that signal their family nature as more authentic than brands that do not. Finally, Study 3 confirms the impact of the family business brand in a choice-based field experiment. Participants were asked to choose between two unknown brands, and the results showed that their choices were driven by the family signal. Taken together, the studies empirically support the effect of a family business brand and demonstrate that family firms enjoy an inherent potential to differentiate themselves from competitors. When consumers face a buying situation with limited information about the brands and products presented, the family signal serves as a judgementrelevant attribute and significantly increases their brand trust, which in turn affects purchase decisions. This family firm trust inference creates a fruitful basis for long-term and committed relationships between consumers and brands (Fournier, 1998; Morgan & Hunt, 1994). However, our research focused on the business-to-consumer (B2C) environment, not the business-to-business (B2B) environment. Simply transferring the results to the B2B context is not possible, as the two markets follow entirely different rules. Whether the family nature of a firm has the same impact in a B2B context needs to be addressed in further research. However, regarding the B2C environment, the impact of a family business brand discovered here has the power to create a

Did not choose brand

60% 40% 20% 0% Family Firm Cue

Baseline (M)

Brand 4.95 4.32 Authenticity Mediation Communicating the Family Nature of a Firm (Family Business Brand) → Brand Authenticity → Brand Trust

Chose brand

80%

Regular Brand (M)

Purchase 3.70 3.04 2.90 Intention Mediation Communicating the Family Nature of a Firm (Family Business Brand) → Brand Trust → Purchase Intention Family Baseline Firm (M) (M)

4.3.2. Results The results of the field study confirm the existence of a positive effect of a family business brand in a near-real setting, as consumers' preferences strongly indicate a tendency toward the brand labeled as a family firm or as “family-run”. In the first scenario, where Brand A (“Brut Bonnet”) was labeled as a family firm and Brand B (“Petulant”) displayed no family firm cue, a vast majority (89.6%) of respondents preferred Brand A. Interestingly, these preferences shifted toward Brand B in the second scenario, where Brand B (“Petulant”) was labeled as “family-company”, resulting in a 72% preference level for Brand B. This study indicates that consumers' preferences changed on the basis of the family firm information, which clearly supports the impact of a family business brand. We also conducted chi-square analyses for each brand to statistically support this result. For both brands (“Brut Bonnet” and “Petulant”) there was a significant relationship between the presentation with a family firm cue (or with no cue) and whether or not consumers preferred the brand; χ2 (1) = 21.48, p < 0.001. This seems to represent the fact that, based on the odds ratio, the odds of consumers' preference were 22.23 times higher if the brand was labeled as a family firm (see Fig. 4 for Brand A). These results add to the findings obtained in the first two studies and confirm the existence of the effect of a family business brand in a more realistic decision-making situation.

100%

Family Firm (M)

No Cue

Fig. 4. Findings from Study 3 (Brand A, “Brut Bonnet”). 128

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Table 2 Overview of measures. Measurea

Construct

Brand trust (Herbst et al., 2012)

Purchase intention (Coulter & Coulter, 2005) Brand authenticity (Moulard et al., 2016) Family firm image (Beck & Kenning, 2015)

Product class involvement (Mittal, 1995) Family climate scaled (Emotional cohesion) (Björnberg & Nicholson, 2007)

a b c d

I trust this brand. This brand is predictable. This brand is dependable. This brand is reliable. This brand is truthful. This brand is competent. This brand has integrity. This brand is responsive. I rely on this brand. This is an honest brand. This brand is safe. How likely is it that you would purchase the [product inserted] from [brand name inserted]? [brand name inserted] has a true passion for its business. [brand name inserted] wants to do its best at providing its product. [brand name inserted] is devoted to what it does. For me, [brand name inserted] is a family firm. I perceive [brand name inserted] as a family firm. [brand name inserted] communicates to its customers that it is a family firm. It is important for me that [brand name inserted] is a family firm. [product category inserted] are very important to me. For me, [product category inserted] do not matter. [product category inserted] are an important part of my life. The emotional bond between us all is very strong. We usually feel happy to be with each other. We miss each other when we're apart for a while. Family members make each other feel secure. Family members feel warmth for each other. We feel a lot of love for each other.

Cronbach α

Loadingb

AVEc

S1

S2

S1

S2

S1

S2

0.87 0.71 0.92 0.91 0.87 0.89 0.84 0.76 0.85 0.89 0.90

0.83 0.77 0.80 0.84 0.83 0.81 0.68 0.62 0.83 0.74 0.83

0.73

0.62

0.96

0.95

0.87 0.67 0.84 0.91 0.89 0.80 0.89 0.92 0.91

0.71 0.69 0.75 0.90 0.92 0.90 0.58 0.90 0.91 0.91 0.93 0.90 0.89 0.92 0.95 0.93

0.51

0.88

0.70

0.89

0.64

0.82

0.65

0.91

0.79

0.85

0.95

0.97

All items measured on a 7-point Likert scale (1 = strongly disagree; 7 = strongly agree) except purchase intention (1 = very unlikely; 7 = very likely). Standardized item loadings. Average variance extracted (Fornell & Larcker, 1981). FC adapted from 8 items to 6 due to comprehensibility based on pretest.

strategic advantage for family firms in positioning their products within the growing battlefield of increasingly interchangeable consumer brands - at least for first-time consumer-brand interactions.

relationship between the family cue and brand trust. Second, our research makes several theoretical contributions to the field of marketing and brand management. Marketing researchers have already unveiled an impressive number of important effects that stimulate and influence the way consumers perceive companies and their brands by providing consumers with informational cues that are not directly related to the brand or product at first sight (e.g., the production process and the “handmade effect” recently shown by Fuchs, Schreier, & van Osselaer, 2015; or the products' source of creation and the “innovation effect of user design” suggested by Schreier, Fuchs, & Dahl, 2012). We add to this stream of literature dealing with effects based on informational cues that provide the consumer with additional information beyond standardized product or brand descriptions. In this way, we open up a new stream of marketing research in that area, as we

5.1. Contributions By linking family firm research with marketing research, our work makes several contributions to both theory and practice across different disciplines. First, the findings add to the small body of existing studies by family business scholars on the favorable perception of family firms (e.g., Beck & Kenning, 2015; Binz et al., 2013; Craig & Dibrell, 2006; Orth & Green, 2009) by showing that communicating the family nature of a brand has a causal effect on relevant dependent variables. We also revealed a cognitive process underlying the effect of the family business brand in order to come to a deeper understanding of this positive effect, and we determined that brand authenticity fully mediates the central

Table 4 Discriminant validity assessment (Study 2). Displaying correlations between Brand Trust (BT), Brand Authenticity (BA), Product Class Involvement (PCI), Family Firm Image (FFI), and Family Climate Scale (FC).

Table 3 Discriminant validity assessment (Study 1). Correlations between Brand Trust (BT), Purchase Intention (PI), Product Class Involvement (PCI), and Family Climate Scale (FC). BT BT PI PCI FC

0.86 0.536** 0.046 0.089

PI

1 0.057 0.042

PCI

0.80 0.119*

BT

BA

PCI

FFI

FC

0.78 0.718** 0.255** 0.384** 0.074

0.72 0.198* 0.435** −0.042

0.90 0.107 0.142

0.83 0.105

0.92

FC BT BA PCI FFI FC

0.89

Notes:aThe non-diagonal elements are the latent correlations, while the diagonal elements (bold) are the square roots of the AVE values. **Correlation is significant at the 0.01 level (one-tailed). *Correlation is significant at the 0.05 level (one-tailed).

Notes: aThe non-diagonal elements are the latent correlations, while the diagonal elements (bold) are the square roots of the AVE values. **Correlation is significant at the 0.01 level (one-tailed). *Correlation is significant at the 0.05 level (one-tailed). 129

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or as an additional element within advertising campaigns. In this context, it is essential that the informational cue be visible and recognizable to the consumer. Based on our findings, this is an effective way to increase brand trust, which in turn affects purchase decisions. However, as our findings also suggest, this effect is driven by a higher level of brand authenticity. Of course, the managers of non-family firms could mimic the branding strategy – but presumably with only short-term success. As consumers' knowledge has increased markedly over time, our findings suggest that the effect will vanish in the long run as soon as consumers find out that the company is not a real family firm, meaning that it will no longer be perceived as an authentic brand. In conclusion, it is noteworthy that branding a company as being family-owned is not without precedents. For example, SC Johnson, a famous producer of household products, has always used the tagline “A family company” in its company logo. More recently, the whisky distillery Glenfiddich has begun to make use of its family background in their newly launched ad campaign (“Family run since 1887”). Our research provides theoretical evidence of the success that such branding activities can achieve. Therefore, managers of family firms are well advised to leverage the inherent differentiation potential of being a family-owned company in their branding strategies.

shift the focus to the dominant type of companies all over the world: the family firm. Third, in addition to linking family firm research to the marketing literature, our research contributes to brand authenticity research. Recently, an increasing number of researchers have conceptualized brand authenticity and underlined the relevance and impact of the construct (e.g., Moulard et al., 2015; Moulard et al., 2016; Napoli, Dickinson, Beverland, & Farrelly, 2014). Our study extends the knowledge of brand authenticity, as we link it with family firm perception and provide evidence that brands which emphasize their family firm background are automatically perceived as more authentic. Fourth, our findings also contribute to research on inference theory by showing that the promotion of the family nature of a firm leads to a family firm trust inference. This can be considered analogous to wellknown inferences like the country-of-origin effect (e.g., Kardes et al., 2004) or the price-quality inference (e.g., Huber & McCann, 1982) and therefore contributes to the further development of inference theory in that we have laid the foundation for exploring a new type of inferences, namely those based on the nature of the firm. 5.2. Directions for future research In this section we derive several areas for future research which are worth considering for both family business and marketing research. First, further research could also explore the downside of communicating the family nature of a firm by considering potential boundary conditions of the positive effect discovered. For instance, when signaling their family nature, companies might be perceived as less innovative due to their ascribed long-term orientation, which may be interpreted as stagnation (Krappe et al., 2011). Similarly, the cultural context could also influence the magnitude of the effect, as the latest edition of the Edelman Trust Barometer reports that the institutional trust advantage for family firms only arises in developed countries, whereas in developing countries family firms do not have any trust advantages compared to non-family firms (Edelman Trust Barometer, 2015). Second, future research could explore the effects of further differentiation of the family business brand by investigating potential differences between more fine-grained informational cues observed in the marketplace, such as “family-owned” and “family-run”. To delve deeper into that topic, scholars could also explore the combination of signaling the family nature of a firm and its founding year (“Family owned since 1902”) or the generational stage (“Family-run for five generations”), both of which have enjoyed growing popularity in practice. Third, in order to advance our understanding of brand authenticity as the main driver of the effect of a family business brand, research should emphasize the importance of both antecedents of brand authenticity, namely rarity and stability (Moulard et al., 2016). Whether both equally account for the authentic perception of family firms remains an unanswered question and calls for further research.

5.4. Limitations As with any research, our work is subject to a number of limitations and caveats that must be considered and evaluated. First, all three of the studies presented in this article are limited to situations where the potential consumers have limited information about the brands presented (e.g. no former experience with it). Second, the impact of a family business brand can be assumed to be stronger for new brands about which consumers have no prior knowledge/attitudes than for existing brands where prior (conscious or unconscious) attitudes toward the brand exist while this assumption is subject to future research. Third, as mentioned above, our findings are bounded by a cultural mindset, which might very likely not be generalizable across different cultural contexts. Fourth, our experiments only represent the businessto-consumer market lending room to future studies. Although many family firms operate in the business-to-business market, our results cannot directly be transferred to this segment due to the different characteristics of these two markets (Botero, Spitzley, Lude, & Prügl, 2018). Last but not least, we make use of behavioral intention measures (purchase intention), which are very common in experimental research (Koschate-Fischer & Schandelmeier, 2014) but have to be interpreted with caution due to the often-neglected intention-behavior gap (Sheeran, 2002). In particular, this gap should be mentioned because participants' behavioral intentions do not necessarily translate into actual behavior (Mittal & Kamakura, 2001; Morwitz, 1997). At the same time, when using behavioral intention measures, one should also consider self-generated validity effects (Chandon, Morwitz, & Reinartz, 2005). The interpretation of our results is therefore subject to this restriction while still presenting a valid and widely used indicator of an economic advantage family firms can enjoy through their branding strategies.

5.3. Practical implications In addition to theoretical contributions, our findings also have several important practical implications for marketing managers in family firms. First of all, our research motivates managers of family firms to disclose their family firm background and emphasize it in their branding strategies. Emphasizing a company's family background is a decision with long-lasting consequences, one of which is the positive impact of the family business brand explored in the present article. By promoting the family nature of a firm, managers can evoke positive brand perceptions, which in turn affect the behavioral intentions of consumers. Therefore, the managers of family firms should include their family background in their branding strategy for differentiation purposes. This could be done in the form of a tagline on the brand logo

Acknowledgements Associate Editor Kalpesh Kaushik Desai and three anonymous reviewers provided outstanding guidance throughout the entire process. We would also like to thank Moritz von Loeper and Josef Strenzke for supporting us during the initial stages of the paper. A special thanks is dedicated to Dr. Dominic Leiner, who provided us with guidance for designing our questionnaires and collecting data via his panel Sosci Survey. Last but not least, our gratitude goes to the entire team of FIF@ Zeppelin University, who always supported us by challenging our ideas.

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Appendix A

Fig. S1. Stimuli (Study 1).

Fig. S2. Stimuli in Study 2.

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Fig. S3. Vignettes in Study 3 (Scenarios 1 and 2).

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Maximilian Lude is a research fellow and doctoral student at the Friedrichshafen Institute for Family Entrepreneurship (FIF) at Zeppelin University, Lake Constance, Germany. His research focus is bridging marketing and family business research by shedding light on the antecedents and consequences of brand perceptions of family firms with a special focus on consumer research. He has presented several papers at international conferences such as the European Marketing Association Conference (EMAC) or the European Academy of Management Conference (EURAM). Reinhard Prügl is full professor and academic director of the Friedrichshafen Institute for Family Entrepreneurship (FIF), Zeppelin University, Lake Constance, Germany. His overall research interest is focused on the intersection of marketing, innovation, and family business. His work has been published in renowned journals such as for example Research Policy, Journal of Product Innovation Management, Marketing Letters, or Journal of Family Business Strategy.

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