is different in several game-changing ways.
First, we develop a novel, integrated and overarching perspective on the fundamental goals of brand management and how we achieve them. We call this perspective the brand admiration management system. This system (Figure P.1) provides a road map for building, strengthening, and leveraging brand admiration over time, in ways that produce value to customers and companies alike. We regard brand admiration as the most desired state of a brand’s health. Unlike other books that primarily provide a set of to do’s, we provide an overarching system whose components are connected and integrated. In this way, our book offers the theoretical coherence that makes its set of “to do’s” highly compelling.
Figure P.1 The Brand Admiration Management System
Second, we directly link brand admiration to the brand’s value to companies. Building, strengthening, and leveraging brand admiration is, we argue, the most important and foundational objective of branding. Using decades of research in marketing and psychology, we emphasize three critical classes of benefits that characterize admired brands. Such brands enable, entice, and enrich customers. These three classes of benefits, called the 3Es for short, have an exponential effect on customers’ relationship with a brand. They build brand admiration by enhancing customers’ trust in, love of, and respect for the brand. This brand admiration, in turn, provides value to the firm. We describe some important psychological processes in Chapter 3 that explain why the 3Es create value for customers (and hence companies).
Third, we describe how companies can build, strengthen, and leverage this value. Rather than focusing on quick fixes, and tactics to enhance fourth-quarter earnings, we examine forces responsible for efficient short-term competitive advantages that also build (Chapters 4, 5, and 6), strengthen (Chapter 7), and leverage (Chapters 8, 9, and 10) brand admiration over the long term. When a short-term focus and long-term goals are aligned, brands enjoy short-term and long-term success. History is replete with examples of brands that have been market leaders for decades, generations, or even a century or more (Chapter 2).
Fourth, we propose an innovative way of thinking about brand architecture design (Chapter 10). We address how various businesses and products within the company’s portfolio are branded to deliver to a company the optimal financial, asset-building, and organizational benefits. We also present a novel and implementable metric for measuring brand equity (Chapter 11) and a set of dashboard metrics that help managers diagnose what’s driving (or not driving) successful brand performance (Chapter 12).
Fifth, our framework is not based on mere assertions. Nor is it based purely on a particular brand example. Instead, it is grounded in decades of theoretical and empirical research from us and other academics in marketing and psychology. In particular, our framework derives from research on fundamental human needs, goals, emotions, and motivations, as well as in empirical research that supports needs, goals, emotions, and motivations as drivers of brand admiration.
Finally, our framework is generalizable. It is equally applicable to the introduction of new brands and the management of existing brands. It is appropriate for brands in different industries and for both B2B and B2C brands. Brand managers, CMOs, CEOs, and employees who work for product brands, service brands, celebrity brands, country brands, institution brands, and NGO brands can all use our framework.
We hope you will see that the ideas in this book are novel, actionable, and strong – indeed, game changing in driving the value of your brand to your customers and your company.
SECTION 1
THE BIG PICTURE
Chapter 1
Why Brand Admiration?
Admired brands create blockbuster value for companies and customers alike.
Introduction
Yes, we have heard about it and seen it with our own eyes, but it is still hard to fully grasp Apple’s miraculous comeback during the first 16 years of the 21st century. In 1999, Microsoft’s stock was at a record high, with its market capitalization close to $620 billion. Apple was teetering on bankruptcy. The notion that Apple would ever match Microsoft’s financial firepower, let alone surpass it, was unthinkable. In a 1998 Vanity Fair interview, Bill Gates “couldn’t imagine a situation in which Apple would ever be bigger and more profitable than Microsoft.” Nearly 17 years later, Apple’s market capitalization stands at $683 billion, more than double that of Microsoft’s. Sales of the iPhone 6s have been phenomenal, and more than 48 million iPhone 6 and 6s units were sold during the last quarter of 2015 alone.1 Indeed, in July of 2015 Microsoft’s chief executive Satya Nadelia stated that if Microsoft is to compete with Apple, Google, and others, Windows must become desired. Microsoft’s Windows operating system has endured as a must-have work tool, not because it’s an object that customers love. From his perspective, making customers love Windows was the critical objective.2
We don’t know what will happen to Apple five or 20 years from now. But the answers to two important questions might help Apple strengthen its success over time. The first asks how Apple turned itself around. The second asks what Apple must do to ensure continuous growth and prosperity. As to the first question, we’ve heard a lot about the things that Apple did right when it introduced the iMac, iPod, and iPhone. However, we do not understand how these and other factors created the powerful Apple brand. Knowing a list of factors is one thing. Understanding how they work together to produce such a strong impact on customers is another. Unless we can answer the first question, it is hard to answer the second.
Microsoft needs to ask why it failed to make people love Windows, despite its must-have usefulness. It also needs to ask whether creating brand love is the ultimate and true destination point to which Microsoft should aspire. We think the answer is no. While important for developing prosperous customer relationships, love alone is limited in its power to sustain customer relationships over time. To create prosperous and sustainable customer relationships, Windows needs to go beyond brand love. Like the world’s most successful brands, it needs to become admired. A fundamental goal of this book is to discuss what admired brands are, how to develop them, how to strengthen them, and how to leverage them over time so that they reap maximal benefits for customers and the company alike. Why does this matter? Let’s explore the brand’s value to companies and customers alike.
The Value of a Brand
The American Marketing Association defines a brand as a name, term, symbol, and/or design that’s intended to identify the goods and services of one seller or a group of sellers and to differentiate them from those of the competition.3 However, we argue that a brand is more than a mere name that helps with identification and differentiation. Identifying a brand and differentiating it from competing brands only makes sense when the brand offers value.
James B. Stewart, “How, and Why, Apple Overtook Microsoft,”
American Marketing Association dictionary, accessed April 9, 2016, www.ama.org/resources/Pages/Dictionary.aspx?dLetter=B.
