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1. Introduction
Today’s economic conditions are accompanied by rapid changes, shorter product lifetime, greater uncertainty and more intensified competition (Ruzgar et al., 2015). Under these economic conditions, the biggest concern of firms is to achieve a competitive advantage and superior performance by increasing the market share through taking advantage of opportunities and overcoming their challenges. They must concentrate all their efforts to achieve their goals. In a competitive environment, there are always many different factors that may be effective on their brand performance (Boafo et al., 2018), which is a very important topic in the strategic and marketing management literature. Although there is no consensus, there are two opposing and main schools of thought in this field; competitive intensity view arising from the industry structure, namely, industry competitive intensity (ICI) and resource-based view (RBV) (Gellweiler, 2018). ICI and access to firm resources are the two key components of profit continuity and brand performance. In general, performance differences of firms are rooted in their ICI or RBV (Gellweiler, 2018).
The IO view introduced by Bain (1959) and developed by Porter (1980) shows that ICI, which is determined by Porter’s five competitive forces, influences the brand strategies, leading to functional differences among firms. Understanding the underlying structure of a firm’s industry is a key factor in shaping its brand strategies and, consequently, improving its performance. A brand in an industry can achieve a profitable position in the long run by aligning itself with these forces and using them properly (Lumumba et al., 2019; Barman and Borman, 2020). In fact, the approach of IO is based on the analysis of external factors of the firm (Hamdoun, 2020). This view assumes that structural characteristics of an industry (e.g. industry concentration and industry growth) are important factors by which a brand can have higher profits and better performance than the market (Hirsch et al., 2020).
There is another view, called RBV, which was proposed by Barney (1991). A firm’s RBV capabilities refer to achieving superior performance of that firm’s brand. Contrary to the IO view, which states that performance in an industry is influenced by external factors, RBV states that a firm’s brand performance is influenced by its internal factors. It further believes that the firm...