Why are there not more valuable services brands? Leslie de Chernatony Professor of Brand Marketing Birmingham University Business School [email_address] May 2008 © Professor L de Chernatony, 2008

* Context * Methodology * Findings * Conclusions The journey

* Context

* Methodology

* Findings

* Conclusions

Brands matter If a person invested $1,000 in August 1994 in the 111 strong brand companies, by December 2000 their investment would have more than quadrupled to $4,525 $1,000 invested in overall stock market would have yielded $3,195 over same time Madden, Fehle and Fournier (2006) Journal of Academy of Marketing Science

If a person invested $1,000 in August 1994 in the 111 strong brand companies, by December 2000 their investment would have

more than quadrupled to

$4,525

$1,000 invested in overall stock market would have yielded $3,195 over same time

What is my brand? Added value Identity – image Relationship Risk reducer Financial Visionary Promise Personality Emotion Values Self or culture Positioning Functionalism Integrated strategy Differentiation Logo Shorthand

Brand as promise A promise which is Distinctive Valued Consistently delivered Kept over time Source : Wolff Olins

Shifting brand paradigm Tangibles Values through communication Problems Services Successes Values through culture Co-created value Frozen value

Discontinuity : Build a Bear Workshop Monitor materials costing €5 or experience generating €45 Buy a shell, stuff it, give it a heart create its voice, stitch it, give it a lifestyle through accessories then create a community

Monitor materials costing €5

or

experience generating €45

Aligning brand-staff values Lush managers are independent, vivacious and dynamic- but we need more of them! Our store managers could be likened to our GODIVA shampoo and conditioning bars – ready to ride through the streets naked for their cause (although we’ve not asked them yet!). Our store managers must be confident and capable

Challenge of services brands Consumers Employees Services brand Corporation Image Experience Internal culture

Staff as brand builder Understanding High Low Low High Commitment Bystanders Champions Weak links Loose cannons

Interbrand Best Global Brands 2007 33% service 67% products 1 financial services brand with country of origin in the UK

Assessing brand success Facet Discounted future earnings Offers significant emotional and/or physical advantages Consumers’ feelings and behaviour Brands potential for growth Company value Corporate reputation Admired by peers Trust Method Interbrand Superbrands Millward Brown/WPP Brandz study Y&R BrandAsset Valuator FT Global 500 Report Fortune Management Today Reader’s Digest

Typical interviews CEO/MD HR Director Operations/ Customer Service Director Marketing Director Agencies “ Ultimate decider” Operations/ Customer Services Manager HR Manager Marketing Manager 3 customer services staff “ Key influencers” “ Enactors”

Brand characteristics Big idea Successful Less successful Supporting brand components

Brand is holistic experience * Consistency is part of succeeders mindset * Consistency results from continually getting cross-functional teams to work together * Consistency is a shared responsibility bridging internal and external

* Consistency is part of succeeders mindset

* Consistency results from continually getting cross-functional teams to work together

* Consistency is a shared responsibility bridging internal and external

Brand as holistic experience Service brand Staff Communications Environment

Brand as holistic experience Touchpoints: - pre-purchase - purchase - post-purchase

Touchpoints:

- pre-purchase

- purchase

- post-purchase

Staff are brand literate * Understand brand and implications for their job * Short statements, resonating * Brand essence isn’t advertising slogan * Brand training

* Understand brand and implications for their job

* Short statements, resonating

* Brand essence isn’t advertising slogan

* Brand training

Internalising the brand Employees internalise Codified brand Comprehended brand Interpreted brand Brand ethos Employee belief and commitment threshold Corporate control

Different departments’ contributions MARKETING : Brand guardians - Define brand and supporting strategy - Internal liaison for coherent enactment - Align image with identity by monitoring gaps Brand HR : Brand enablers CUSTOMER SERVICE : Promise deliverers - Develop, implement and refine HR policies - Lubricate other departments’ processes to support the brand - Facilitate employee buy-in - Living exemplars - Behaviour to naturally enact brand - Pan-company interactions to support brand - Relationship builders recovering problems

Integrating departments’ support Facilitating Factors Impeding Factors Hygiene Factors: Interact * Meetings * Tactical HR processes * Technology * Hard work * Internal communications * Monitoring Brand-related factors: Collaborate * Importance of leader * Cross-functional teams * Special projects * Planning * Appropriate culture * Structure * Communications * Culture of internal tension and lack of inter-departmental cooperation

Excellent, personalised customer service Functional values Emotional values Promised experience +

Excellent, personalised customer service Core benefit Facilitating services Supporting services (Gronroos 2000) Brand

Excellent, personalised customer service Core benefit Facilitating services Supporting services Customer participation Accessibility Interactions (Gronroos 2000) Brand

Excellent, personalised customer service * Leads to stronger bonding * Staff behaviour during interactions - training and motivation * Loose branding enables values driven personalisation

* Leads to stronger bonding

* Staff behaviour during interactions

- training and motivation

* Loose branding enables values driven personalisation

Responsive to change * Dynamic brands through openness to organisational learning * Longevity of corporate brand as risk reducer versus staid slow responder

* Dynamic brands through openness to organisational learning

* Longevity of corporate brand as risk reducer versus staid slow responder

Conclusions * Is there a big idea? * Mechanisms for holistic experience * Moving towards brand ethos * Integrating departments support

* Is there a big idea?

* Mechanisms for holistic experience

* Moving towards brand ethos

* Integrating departments support