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Whether a Corporate Logo has a Frame Around it Can Significantly Impact Sales According to Marketing Department Study

November 22, 2016
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Certain companies and products can benefit by having a frame around their logos, while others are harmed by such a design feature, according to a new study by Michael Tsiros, chair and professor of marketing at the School. The study, to be published in the December issue of The Journal of Consumer Research, found that logo frames can invoke symbolic associations similar to those attributed to physical boundaries. Based on the study, companies operating in a high-risk industry, such as insurance, can benefit by having a logo with a frame because a framed logo is perceived as “protecting.” This, Tsiros says, will lead consumers to believe the company is better at mitigating risk and significantly increase the likelihood they will make a purchase. Conversely, the research shows, companies operating in a low-risk environment, such as low-priced household goods and digital apps, may be harmed by the use of a framed logo because framed logos are perceived as “confining,” significantly decreasing the likelihood consumers will make a purchase. This also includes firms operating in an industry incompatible with confinement (e.g., an art supply store like Michael’s or an advertising firm like Ogilvy & Mather). The research suggests they should avoid employing a frame around their logos.

“The finding that logo frames can have either a positive or negative effect on purchase intent among consumers has significant implications for marketers,” said Tsiros, who conducted the study along with professors from Florida State University and the University of Oregon.

“Corporations spend millions of dollars in designing and rolling out their logos and furiously guard their brands, yet little research has been conducted on the impact of a logo frame, until now.”

In addition to benefiting firms in high-risk environments, the researchers believe lesser-known brands and new products can benefit from framed logos because they are generally associated with a high degree of risk. This is particularly true when the product is being launched under a new brand name. Further, the symbolic association of brand logos also extends to secondary brand identifiers, such as, brand slogans but to a lesser extent.  

A significant percentage of companies have a frame around their logo, including General Electric, Coach, and the J.M. Smucker Company. The study found approximately 9 percent of U.S. companies on the New York Stock Exchange have a framed logo design.

The researchers studied the effect of a variety of risk manipulations (i.e., satisfaction guarantees, price, and priming tasks) across several product categories (i.e., scented candles, MP3 Players, and automobiles) and with more than 1,800 participants across multiple studies. Participants were asked to indicate how likely they were to purchase the featured product on a 9-point scale (1=Absolutely would not purchase, 9= Definitely would purchase). Across all the studies, participants indicated a significant increase in their purchase intention (ranging from 25% - 33%) when the logo was framed and the risk was high. Similarly, participants indicated a significant decrease in their purchase intention (ranging from 22% - 30%) when the logo was framed and the risk was low.

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