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Chapter 3
Brand Resonance and the Brand Value Chain
Chapter Objectives
1. Dene brand resonance.
2. Describe the steps in building brand resonance.
3. Dene the brand value chain.
4. Identify the stages in the brand value chain.
5. Contrast brand equity and customer equity.
Overview
This chapter deals in greater detail with two interlinking models, which,
along with the brand positioning model, make up the brand planning
system.
The chapter rst discusses the brand resonance model, which
describes how to create intense, active loyalty relationships with
customers. The model considers how brand positioning a%ects what
consumers think, feel, and do and the degree to which they resonate
or connect with a brand.
The chapter begins by presenting the four steps to building a strong
brand. This will help students consider brand salience, performance,
imagery, judgments, feelings, and resonance as brand building blocks.
The chapter talks in detail about each of these characteristics including
the attributes and benets that underlie brand performance. The
chapter also highlights the types of brand judgments, namely,
judgments about quality, credibility, consideration, and superiority.
Resonance is characterized in terms of intensity, or the depth of the
psychological bond that customers have with the brand, as well as the
level of activity engendered by this loyalty.
Next, the chapter presents some of the main implications of the brand
resonance model and moves on to confer how brand resonance and
these loyalty relationships, in turn, create brand equity or value.
The brand value chain model is discussed next. It is a means by which
marketers can trace the value creation process for their brands to
better understand the nancial impact of their marketing expenditures
and investments. Based in part on the customer-based brand equity
(CBBE) concept, it o%ers a holistic, integrated approach to
understanding how brands create value.
© 2013 Pearson Education, Inc. publishing as Prentice Hall.
The chapter points out that brand value is created at a stage when
customers have (1) deep, broad brand awareness; (2) appropriately
strong, favorable, and unique points-of-parity and points-of-di%erence;
(3) positive brand judgments and feelings; (4) intense brand
attachment and loyalty; and (5) a high degree of brand activity.
The chapter then moves on to discuss the implications of the brand
value chain model and concludes by reviewing both the models and
then throwing light on customer equity by calling it the sum of lifetime
values of all customers. Several di%erent concepts and approaches
relevant to the topic of customer equity have been discussed.
Brand Focus 3.0 at the end of the chapter provides a detailed overview
of the topic of customer equity.
Science of Branding
THE SCIENCE OF BRANDING 3-1
LUXURY BRANDING
Brand and its image are often competitive terms and, hence, luxury
brands are one of the purest examples of branding. A number of
characteristics dene luxury branding and suggest strategic and
tactical guidelines such as:
Maintaining and controlling a premium, prestige image with
luxury branding is crucial and a priority.
Luxury branding often relies on an aspirational image that
benets from a trickle-down e%ect to a broader audience via PR
and word-of-mouth.
To ensure pleasurable purchase and consumption experiences,
marketers of luxury brands must control all aspects of the
marketing program.
Distribution for luxury brands should be carefully controlled via a
selective distribution strategy.
Luxury brands are enhanced by a premium pricing strategy and
few discounts.
Brand architecture for luxury brands must be managed very
carefully with only selective, strategic licensing and extensions.
Brand hierarchies and portfolios must be employed.
Luxury brands can sometimes benet from secondary
associations with linked personalities, events, and countries.
Brand elements can be important drivers of brand equity for
luxury brands.
© 2013 Pearson Education, Inc. publishing as Prentice Hall.
Luxury brands can compete with luxury brands from other
categories for discretionary consumer dollars.
Luxury brands must legally protect all trademarks and
aggressively combat counterfeits.
THE SCIENCE OF BRANDING 3-2
PUTTING CUSTOMERS FIRST
According to authors Larry Selden and Geo%rey Colvin, a few
companies, such as Dell, Best Buy, and Royal Bank of Canada, have
been solid stocks for shareholders through the years because of their
customer-centric approach. Customer-centricity means that all
employees understand how their actions a%ect share price.
Selden and Colvin maintain that customer-centric companies are a
good bet for investors because they hold an advantage that can lead
to a jump in share price. To determine whether a company is truly
customer-focused, Selden and Colvin suggest customers ask
themselves the following ve questions:
Is the company looking for ways to take care of you? Only a few
companies identify customer needs rst, and then create ways to
meet them. Too many companies try to make customers buy the
products and services they already o%er.
Does the company know its customers well enough to
di%erentiate between them? True di%erentiation means knowing
who your various customer segments are, what each group
wants, where the groups are shopping, and how to serve the
customers individually.
Is someone accountable for customers? At most companies,
various departments own pieces of customer segments, but no
one owns any specic one. At companies with customer-centric
approaches, however, things are di%erent.
Is the company managed for shareholder value? If a company is
managed for shareholder value, employees know about earning
a return on invested capital that exceeds the cost of capital, plus
investing increasing amounts of capital at that positive spread
and maintaining that spread for as long as possible.
Customer-centric companies apply those criteria to customer
segments.
Is the company testing new customer o%ers and learning from
the results? Constant learning about what customers want and a
formal process for sharing it are critical to customer-centricity.
Branding Briefs
© 2013 Pearson Education, Inc. publishing as Prentice Hall.
BRANDING BRIEF 3-1
BUILDING BRAND COMMUNITIES
Apple
Apple encourages owners of its computers to form local Apple user
groups, many of which o%er monthly meetings, an informative
newsletter, member discounts, special interest groups, classes, and
one-on-one support. The user groups provide Apple owners with
opportunities to learn more about their computers, share ideas,
friendships with fellow Apple users, as well as sponsor special activities
and events and perform community service. A visit to Apple’s Web site
helps customers nd nearby user groups.
Harley-Davidson
The rst-time buyer of a Harley-Davidson motorcycle gets a free
one-year membership. HOG benets include a magazine called Hog
Tales, a touring handbook, emergency road service, a specially
designed insurance program, theft reward service, discount hotel rates,
and a Fly & Ride program enabling members to rent Harleys while on
vacation. The company also maintains an extensive Web site devoted
to HOG, which includes information about club chapters and events
and features a special members-only section.
Jeep
Jeep owners can convene with their vehicles in wilderness areas across
the United States as part of the company’s oBcial Jeep Jamborees and
Jeep Rocks and Road. Jeep Jamborees bring Jeep owners and their
families together for two-day o%-road adventures in more than 30
di%erent locations throughout the United States from spring through
autumn each year. Promising to be “every bit as muddy,” the 2010
Jeep Rocks and Road tour hit 11 di%erent venues across the country to
allow existing and prospective Jeep owners to put the 2011 vehicle
lineup through their paces on- and o%-road.
Brand Focus
BRAND FOCUS 3.0
CREATING CUSTOMER VALUE
Customer–brand relationships are the foundation of brand resonance
and building a strong brand. Many rms are now more carefully
dening the nancial value of prospective and actual customers and
devising marketing programs to optimize that value.
© 2013 Pearson Education, Inc. publishing as Prentice Hall.
Marketers have long recognized the importance of adopting a strong
consumer and customer orientation. The customer-based brand equity
concept makes it clear that the power of a brand resides in the minds
of consumers and customers. However, too many rms still nd
themselves paying the price for lacking a customer focus.
Discussion questions
1. Pick a brand. Attempt to identify its sources of brand equity. Assess
its level of brand awareness and the strength, favorability, and
uniqueness of its associations.
2. Which brands do you have the most resonance with? Why?
3. Can every brand achieve resonance with its customers? Why or why
not?
© 2013 Pearson Education, Inc. publishing as Prentice Hall.
4. Pick a brand. Assess the extent to which the brand is achieving the
various bene#ts of brand equity.
5. Which companies do you think do a good job managing their
customers? Why?
Exercises and assignments
1. Have students pick a brand of their choice. Then have them answer
how they would go about establishing the six brand building blocks
with customers if the brand was their own. The students may then
compare the steps taken by them with the steps taken by the
company to establish loyalty relationships with customers.
© 2013 Pearson Education, Inc. publishing as Prentice Hall.
2. Tell students to imagine they are sitting in a room with two doors.
When a knock sounds at each, the butler (!) announces that a
particular brand is at one entrance to the room (e.g., Target), while
another brand is at the other (e.g., Wal-Mart). Ask students to
describe each brand in terms of what it would look like, what it
would be wearing, what it would say when you went to the door,
and what its reason for visiting was. (Alternatively, you can have
students conduct this assignment outside of class by talking to
consumers.)
3. Have students create mental maps for several well-known brands.
Have them use these mental maps to develop brand mantras that
capture the core values and attributes of the brands. Then have the
students compare the mantras they generated with the actual
brand mantras. Are they similar? Why or why not? Possible
companies include Nike (Authentic Athletic Performance), and
Disney (Fun Family Entertainment).
© 2013 Pearson Education, Inc. publishing as Prentice Hall.
4. Provide the students with examples of brands (E.g. Budweiser,
California Milk Processor Board, Minute Maid, and 7UP) and discuss
why their marketing programs were a success or failure. Have the
students be in the shoes of a marketer and have them design a
well-integrated marketing program for any of these brands. The
students must consider factors such as distinctiveness, relevance,
integration, value, and excellence of the program. This activity will
help the students better understand the concept of program quality
multiplier.
Key take-away points
1. Brand planning is aided by three interlocking models that can both
qualitatively guide and interpret possible marketing actions as well
as quantitatively measure marketing e%ects
2. Building a strong brand involves establishing brand salience,
performance, imagery, judgments, feelings, and resonance with
customers.
3. Building brand awareness helps customers understand the product
or service category in which the brand competes and what products
or services are sold under the brand name.
4. A highly salient brand is one that has both depth and breadth of
brand awareness.
5. Brand performance describes how well the product or service meets
customers’ more functional needs.
6. Brand imagery refers to more intangible aspects of the brand, and
consumers can form imagery associations directly from their own
experience or indirectly through advertising.
7. Brand meaning is what helps produce brand responses, or what
customers think or feel about the brand.
© 2013 Pearson Education, Inc. publishing as Prentice Hall.
8. Warmth, fun, excitement, security, social approval, and self-respect
are the important types of brand feelings.
9. The power of the brand and its ultimate value to the rm reside with
customers.
10. Brand value creation begins with marketing activity by the rm.
11. Modications to the brand value chain can expand its relevance
and applicability.
© 2013 Pearson Education, Inc. publishing as Prentice Hall.
