Impact of brand positioning strategy on the financial performance of commercial banks

Download This Article

This work is licensed under a Creative Commons Attribution 4.0 International License.

Abstract

Brand positioning serves as a critical differentiator in today’s dynamic business environment, enabling banks to secure a competitive edge. Prior research by Arora and Chaudhary (2016) underscores the positive influence of brand value on profitability, shareholder value, and overall financial efficiency. This study delves into the Vietnamese commercial banking sector to examine the influence of brand repositioning strategies on both brand value and business performance. Employing a comprehensive survey encompassing seven leading Vietnamese banks, the research leverages partial least squares structural equation modeling (PLS-SEM) to elucidate the intricate relationships between brand repositioning initiatives, brand value creation, and subsequent financial performance. The empirical findings contribute robust evidence, revealing a positive and significant association between brand repositioning and: 1) enhanced brand value, 2) improved business performance, and 3) the crucial mediating role of brand value in the relationship between brand repositioning and financial success. The findings underscore the strategic importance of brand positioning for Vietnamese commercial banks. By effectively repositioning their brands, banks can enhance brand value, leading to improved financial performance. This research provides valuable insights for banking executives seeking to optimize their branding strategies and drive sustainable growth.

Keywords: Brand Positioning, Rebranding, Commercial Banks, Financial Performance

Authors’ individual contribution: Conceptualization — D.T.T.H.; Methodology — V.T.K.O.; Software — V.T.K.O.; Validation — V.T.K.O.; Formal Analysis — V.T.K.O.; Investigation — V.T.K.O.; Resources — V.T.K.O.; Data Curation — V.T.K.O.; Writing — D.T.T.H. and V.T.K.O.; Visualization — D.T.T.H.; Supervision — D.T.T.H.; Project Administration — D.T.T.H.; Funding Acquisition — V.T.K.O.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: G2, M1, M3

Received: 25.02.2024
Accepted: 11.11.2024
Published online: 15.11.2024

How to cite this paper: Hang, D. T. T., & Oanh, V. T. K. (2024). Impact of brand positioning strategy on the financial performance of commercial banks. Corporate & Business Strategy Review, 5(4), 163–170. https://doi.org/10.22495/cbsrv5i4art15