Articles from Cass Knowledge

How brand leaders and consumers co-create charismatic authority in the marketplace

Charismatic brand leaders inspire awe and devotion amongst consumers. They are able to transform ordinary people into effective acolytes, who will not only purchase their brands but promote them, invest in them, and even defend them from criticism. This study finds that this authority is actually a co-creation between the leaders and the consumers themselves.

Charismatic brand leaders matter to consumers. CEOs, entrepreneurs, celebrity bloggers, and many other types of brand leader can wield considerable influence on consumers. The influence can be so profound it can even effect social change.

How do brand leaders acquire this charismatic authority? Past research has predominantly focused on brand leaders' personalities and actions in an attempt to understand their rise, and in some cases, fall. These leaders possess attributes such as skill, vision, authenticity, and charisma which excite and inspire. However, without external validation, the phenomenon of a charismatic authority would not exist. The paper Charismatic Entrainment: How Brand Leaders and Consumers Co-Create Charismatic Authority in the Marketplace, recently published in the Journal of Consumer Research, looks at how leaders and consumers interact, and in doing so actually co-create charismatic authority in the marketplace.

The focus of the study is Heinrich Staudinger, founder and CEO of the Austrian footwear brand Waldviertler. Staudinger is widely considered a charismatic leader in Austrian society. Founding the brand in the 1980s, Staudinger navigated the company's course through two severe liquidity crises. The passionate manner in which he fought for his company's funding against opposition from banks and Austria's Financial Market Authority (FMA), gained him considerable public interest and support. Even though he lost his legal battle with the FMA, he managed to enlarge his own and his brand's follower base, and secure waiver agreements from his investors.

To explore empirically how charismatic authority is co-created in the marketplace, the researchers collected leader-, consumer-, and media-level data about Staudinger, covering one of the crisis periods in his company's history. Interviews with investors, consumers, journalists, and Staudinger himself were compiled, along with archival data from newspapers, social media, and the brand's own website.

An interpretative analysis of this data revealed a pattern of three interlaced market-based practices: staging, validating, and challenging. Together, they constitute a socio-cultural mechanism the researchers term "charismatic entrainment". This notion helps explain how a brand leader can temporarily synchronise elements of a complex system (i.e. consumers, critics, products etc.). When staging charismatic authority, brand leaders weave latent socio-cultural tensions into polarised worldviews, and take significant personal risks to demonstrate their ability to lead social change. Consumer followers validate brand leaders' claims for charismatic authority by inwardly adopting their risk perceptions, and outwardly encouraging them to persist in their staging.

Consumer-critics also contribute significantly to charismatic entrainment by challenging brand leaders' claims for charismatic authority. They take a more sceptical view of charismatic leaders, and will actively denounce such leaders with the aim of protecting the consumer from exploitation. Leaders and their consumer-followers tend to respond to these challenges with further staging and validation, further fuelling charismatic entrainment.

Brand leaders, consumer-followers, and consumer-critics therefore collectively establish brand leaders as charismatic authorities in the marketplace. Consumer-followers are neither mere passive recipients of a brand leader's staging, nor do they simply ascribe charismatic authority to leaders. They motivate further staging and challenging through their sometimes passionate public support. The study also demonstrates that critical consumers play a key, co-constitutive role in the entrainment process by discrediting brand leaders' messages, and stoking public debates.

Overall, the findings reveal how charismatic co-creation in the marketplace involves a more active and broader range of participants than previously recognised.

The accepted version of the paper Charismatic Entrainment: How Brand Leaders and Consumers Co-Create Charismatic Authority in the Marketplace is available for download from the Journal of Consumer Research website.