BRAND REPUTATION, EFFICIENCY AND THE CONCENTRATION PROCESS: A CASE STUDY

The evidence from the European white goods industry, discussed in this paper, shows that once a brand segmentation of the market turns out to be sufficiently stable that is when brand-quality reputation becomes an important factor in the competitive game. It represents a strong inertial factor in the growth of firms even if market structure is far from being efficient in terms of plant size. The paper shows how the inertial role of brands has strongly affected the route of industrial concentration: it has been an incentive to mergers and takeovers rather than to internal growth, particularly when demand stabilized.