Analysis On Decision-Making Of Brand Strategy Of Enterprises Under Asymmetric Information

Brand, as the most beautiful scenery in the competitive market, as the most dazzling star in the assets of enterprises, as the most magnificent symbols in the eyes of consumers, has become the object enterprises are eager to obtain. Indeed, the enterprises have nothing to do but holding brand strategy to respond to growing competition, and brand strategy help some company come to forth from price war, but it's not rational cognition of brand strategy to regard brand as a life-saving straw, or be used as instrument of their own, and the cognition will push the enterprises into greater risk by making rash decisions. More and more enterprises found that―branding is to court death, not branding is waiting for death‖; the saying is a vivid manifestation of the puzzle of the enterprises. The author purposes to give theoretic opinion and practical guide line on decision-making of brand strategy of the enterprises.After studying and analyzing the present literatures about brand strategy, the author found that there was an important logic flaws in current research on brand strategy, which is―how to establish a brand‖was focused on, but―whether we should establish brand‖is ignored. Actually, the latter is clearly more fundamental. The misunderstanding of brand strategy led to many enterprises blindly brand building and ultimately failed.At the same time, asymmetry is commonly found in information between enterprises and consumers, and it is the base and causes of brand, so the understanding of brand and analysis on brand strategy is all based on the assumption. The problem of the dissertation focused on how the enterprises make the decision of the brand strategy in order to maximize the profits, and game theory was adopted through all.In response to this issue, the author redefined the conception of brand and brand strategy using information economy for reference, offered a theoretical framework on the brand strategy considering the logic, and obtained the prerequisite and basis for decision-making on brand strategy by modeling with game theory, which is significant on development of theoretical and practical aspects of the brand strategy. In particular, the content of this paper is structured as follows:Chapter 1: Introduce the background, significance, contents, methods and frame structure of the research.Chapter 2: On the basis of collection and study on domestic and international literatures of brand strategy, the author enumerates the concepts of brand according to different schools, concluded the understanding of brand strategy from the various sectors, and listed various relevant theories and conceptual models about brand strategy. On this basis, commented on the status quo of the study on brand strategy comprehensively, and raised the thinking and enlightenment from the commentions.Chapter 3: According to theory of information economics, the author redefined the concept of brand and brand strategy, and proposed a systematic framework of the brand strategy, presented the theoretical foundation and analysis tools this study based on, raised the basic assumptions, and gave further analysis of ideas, which constitute the theoretical basis of this study.Chapter 4: The author started from the understanding of significance of brand, and then, analyzed the situation of inefficient market being lack of the brand as a signal under asymmetric information with the Lemon Model. This leads to the necessary of establishing brand strategy by enterprises, and obtained the decision-making preconditions of brand strategy through the models.Chapter 5: The author revealed the principle that the brand as a signal about product quality can improve consumer welfare through comparing the relationship between the consumers'utility and product quality when there are signals and no signal. At the same time, found out the necessary conditions of signaling mechanism of brand. Then, under the assumption that the variables of decision-making are discrete, and the brand does not affect consumers'utility, the author analyses the perfect Bayesian Nash equilibriums and the conditions that these equilibrium exist under the asymmetric information, which helped us get the key factors and some basis for the decision-making on the direction of brand strategy for enterprises.Chapter 6: The author analyzed the decision-making on objective of brand strategy for enterprises under asymmetric information by using signaling model, with the assumption that the variables of decision-making are continuous, and the brand does affect consumers'utility. The author also got the key factors and some basis for decision-making on the objective of brand strategy for enterprises. In addition, the situation when the brand as a signal represents other information was mentioned.Chapter 7: The author gave the examples of how to use the findings of this dissertation in practice.Chapter 8: The author summarized the dissertation wholly, stressed the conclusions and innovations, and pointed out the limitations and further research directions.In this dissertation, the main innovations embodied in the following three aspects:First of all, the topic and viewpoint of the paper is innovative. The author thought that the brand strategy should not be understood simply as―how to establish a brand‖, but should be thought―whether we should establish brand‖and―what the objective of the brand is‖in the first place. This paper also believes that the enterprises and consumers are most closely associated with the brands, and they are the two players in a game. Therefore, the paper takes the asymmetric information between enterprises and consumers on product quality as the basic assumptions, researched the issues about the premise of brand strategy ,―whether we should establish brand‖and―what's the objective of the brand‖through the model of game theory.Secondly, there are innovations in the analysis tool and brand theory. The author researched brand by using the game theory with the framework of economic analysis, which is rare. The author redefined the concept of brand and brand strategy by absorbing the relevant results of information economics, proposed the framework of brand strategy considering the logical sequence of decision-making, and gave the prerequisite conditions of brand strategy of enterprises and necessary conditions of the signal mechanism of brand by using the adverse selection model and the signaling model.Third, there are innovations in the brand practical level. The author identified some factors that have important impact on the decision-making of brand strategy for enterprises, and found out some basis for decision-making on the direction and objective of the brand strategy.