Indore (Madhya pradesh): A new study by IIM Indore faculty member Prof Manoj Motiani revealed that customer-centric excellence is driven from the inside out. When employees clearly understand the brand and believe their organisation genuinely fulfils its promises to them, they strongly identify with the brand.
This identification then leads to better customer-oriented behaviour, higher employee-based brand equity, stronger brand advocacy and active participation in brand development, showing that credible people practices are as vital as marketing in building strong brands.
Published in the international Journal of Product & Brand Management, the research examined how employees’ understanding of brand values, combined with their perceptions of whether employers honour promised obligations, influences customer-facing behaviour and long-term brand performance. The study drew on data from 235 service-sector employees across consulting, banking, healthcare, hospitality, IT and education, using advanced statistical modelling techniques to analyse key relationships.
The research bridges two important but often separately studied areas -- internal branding and psychological contract theory. While internal branding focuses on communicating brand values and promises to employees, psychological contract fulfilment reflects whether employees feel the organisation has lived up to those promises in practice.
The findings show that both factors are crucial in building employee brand identification, where employees emotionally align their own success with that of the brand.
According to the study, employees who are well-informed about brand values and who feel fairly treated by their organisations are more likely to identify strongly with the brand. This identification, in turn, leads to higher employee-based brand equity, stronger employer brand patronage and increased engagement in customer-oriented behaviour and brand development activities.
The research emphasises that brand-building extends far beyond advertising and external communication. “Employees are the brand in service organisations,” the study notes, highlighting that customers’ experiences are often shaped directly by frontline staff. When employees trust their employer and believe organisational commitments are being fulfilled, they are more inclined to advocate for the brand, recommend products and services, and go beyond formal job roles.
The study also adds to existing knowledge by identifying psychological contract fulfilment as a key driver of employee-based brand equity, alongside internal branding initiatives. This insight offers managers a strategic alternative to relying solely on external marketing investments, pointing instead to credible internal practices that enhance engagement, retention and brand advocacy.
“Overall, the study makes a strong case for integrating people management with brand strategy. By aligning internal brand communication with consistent and trustworthy organisational actions, firms can cultivate employees who not only understand the brand but actively live it -- an increasingly vital advantage in today’s competitive, customer-driven marketplace,” Motiani said.
