Hot Topic:

Conceptualising the Service Brand &

Broadening the Concept of Brand Equity

Professor Rod Brodie

University of Auckland Business School

Frontiers in Services Conference

June2006
University of Queensland
Australia
MSI Top Research Priority
 Towards Service Centric Thinking
• Goods vs. Services is not the point (CMP Research)
• 80% of all firms describe their primary market offer
having an emphasis on service
• all firms differentiate on the basis of their service offer
• Vargo & Lusch’s “New Logic”
– From Goods-Centred Exchange
• tangible (operand) resources, embedded value and
transactions
– To Service-Centred Exchange
• intangible (operant) resources, the co-creation of value
and relationships
• How does this change thinking about marketing &
branding?
 Evolving To a New Frame of Reference
Lusch & Vargo (2004)

Market To Market With

To Market (management of (collaborate with
(matter in motion) customers & customers & partners
markets) to produce &
sustain value)

Through 1950 1950-2005 Future

 “To Market” Transitional “Market With”
Concepts Concepts Concepts

Goods Services Service

Products Offerings Experiences

Feature/attribute Benefit Solution

Value–added Co–production Co–creation of value

Profit maximization Financial engineering Financial feedback/learning

Price Value delivery Value proposition

Equilibrium systems Dynamic systems Complex adaptive systems

Supply Chain Value–Chain Value–creation

network/constellation

Promotion Integrated Marketing Dialog

Communications

Product orientation Market orientation Service orientation

Lusch & Vargo (2006)

 Multifaceted Nature of Brand
• Consumer based concepts
– identity, logo, image, symbol, expression, and personality

• Organisational concepts
– positioning statements, cluster of values, vision, and risk reduction

• Relational concepts
– promises, trust and commitment, relationships, and experience with
customers and other stakeholders

• Financial perspective
– a resource or asset that creates value
– above the water line (15%)
• what is visible about the brand to the consumer i.e. the logo and name
– below the water-line (85%) are the unseen value-adding processes
 Integrating the Research: Role of “the Brand”
in Co-creating Value

Consumers, Customers
& Stakeholders
INTERACTIVE EXTERNAL
‘co-creating ‘making promises’
meaning and through value
experience ’ propositions’

Brands ( & Company)

‘facilitating, mediating & realising Organisation
Employees
the co-creation of value’

INTERNAL
‘enabling the fulfillment created by promises ’
 Is there a Missing Fundamental Premise in
the SD Logic?
Service brands
facilitate and mediate the marketing processes used to
realise the experiences & the co-creation of value
between the organisation & its customers &
stakeholders)
provide sign systems that symbolise meaning in the
marketing network,
hence are a fundamental asset or resource that a
marketing organisation uses in developing service-based
competency and hence competitive advantage.

But does this overstate the case?

– danger of becoming too brand centric and this detracts
from customer centric logic (Rust al 2005)
 Synergistic Advantages from a Multi-method
Approach

Quantitative and qualitative inquiry can support and inform each other.
Narratives and variable-driven analyses need to interpret and inform
each other. Realists, idealists and critical theorists can do better by
incorporating other ideas than by remaining pure. Think of it as
hybrid vigor. (Huberman & Miles 2002, p396)

“If my thoughts are at least close to the mark, researchers in

marketing are entering the age of ‘pluralism’… “ (Green 2001 – marketing
scientist)

“When consumer researchers discuss multi-paradigm research a visual

metaphor usually dominates, notably that of overcoming perspectival
limitations to create more comprehensive frameworks.”
Thompson, Arnould & Stern 1997 – postmodernists)