| Summary: | 碩士 === 國立交通大學 === 管理科學系所 === 95 === In the past, Taiwan was known for its excellence on OEM (Original Equipment Manufacturer) or ODM (Original Design Manufacturing) business model. Nevertheless the model had been challenged recently. According to Stan Shih's “Smiling Curve” theory, R&D and brand are the highest value-added segments of the industry value chain. Taiwanese companies should allocate more resources on branding to create higher added value. As a result, branding is an extremely important issue for Taiwanese corporations. Although the importance of branding has been widely recognized, many firms in Taiwan still hesitate for branding. Whether developing own brands for Taiwanese companies could improve financial performance is still under debating. Therefore, empirical studies exploring the relationship between branding and firm performance become increasingly important.
The subjects of this study are firms on the list of the Taiwan top 10 global brands during 2003~2006 published by Taiwan External Trade Development Council (TAITRA) and Interbrand. We create four portfolios from those companies. The first portfolio contains brands ever get into top 20 list; the second one contains brands ever enter top 10 list; the third one contains brands never enter top 10 list; and the final portfolio contains the same brands as the second portfolio but is weighted by brand value. The data were analyzed by Fama-French method which has been commonly used in financial area in order to examine the relationship between brand value and stock price return.
The findings of this study are as follows. First, the return of the portfolio that consists of top Taiwan global brands is not significantly outperformed the market. Second, the stock price return and risk of portfolio consists of brands ever get into top 10 list are better than those never on the top 10 list. Finally, enhancing brand value could improve the stock price return and risk. The implication of this research is that Taiwanese brands mostly are at an initial stage compared with global brands. So the impact of brand value on firm performance of Taiwanese brands is not so significant than global brands.
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