Brand Value: Where Marketing And Human Capital Meet

Brand Value: Since the management philosophy based on creating value for the customer began to be discussed in the 1980s, Brand Equity has become one of the key marketing concepts. The need to make the process of creating brand value more tangible has led to the development of a wide range of models that explain this process (Today there are almost 300 Brand Equity models in the world). Most of these models are based on creating value for the customer. In general, they suggest that brand equity originates from the knowledge of the brand by its customers.

The most inclusive approaches that start from an internal perspective take into account not only the customer’s brand awareness. They also incorporate other circumstances such as employee behaviors in accordance with brand values. However, these approaches are much rarer. However, creating brand value “from within” is an extremely relevant idea. Employees not only represent an important interest group but also constitute, especially in the service sector, a very relevant source of value creation for the brand.

Marketing Of Services And Marketing Of Employees

Conceptually, a brand is the same for a product as it is for a service. However, for services, trademarks acquire a special utility. This utility is based on the services’ need to build trust as a consequence of the invisible nature of their offering. Brand equity is created when the brand promise is consistent with the customer’s service experience. (Brand value for the customer)

The customer experience, initially designed by the marketing department, ultimately depends on the employee-customer interaction. Therefore, employees constitute a very powerful medium for building brands.

In A Service Brand, Everything Begins And Ends With The Employees.

To these two perspectives of brand equity, it is necessary to add the fact that in service markets, strong brands are largely so because they have been able to incorporate the behavior of employees into the “promise” of the brand and turn it into something of its own and lasting. In these cases, the employees, through the internalization of the promise, adopt a series of behaviors that are the basis for creating brand value for the customer.

The Third Perspective Of Brand Equity Emerges: “Employee-Based Brand Equity”.

Through the adoption of internal marketing policies, organizations can align their systems, organization, and culture to realize customer expectations. And through employee internalization of brand values, explicit and implicit brand promises can be realized.

Employee-based brand Equity

Until now, efforts in what has been called “personnel marketing” have focused on identifying the needs and expectations of employees and articulating a value proposition that meets their expectations. This has allowed the creation of the concept of “employer brand” aimed at creating a corporate value proposition capable of retaining and attracting talent to the organization.

However, although attractive, this practice does not come full circle. A virtuous circle begins in the behavior of the employees in their interaction with the client and ends in its materialization in the form of a financial flow.

The new employee-based perspective of Brand Value aims to create differential behaviors that allow the materialization of the brand’s promise in its interaction with the client.

From this perspective, shareholder brand equity is the result of the interaction between employee-based brand equity and customer-based brand equity.

Brand Strength An Integrating Model

Brand strength is a concept that makes it possible to relate the internal meaning of the brand to employees and the importance and values ​​of a brand to its customers. In other words, the internal and external strength of a brand are the two dimensions of a more general concept of brand strength from which the following typologies are derived.

Potentially winning brands. (high internal strength and low external strength)

They are often in their early stages of formation. The attitudes and behaviors of employees highly committed to the brand are not yet reflected in the behaviors of customers. A clear example of this type of brand is Apple in its early days. Their highly motivated professional team was unable to convey their enthusiasm for the products they created to potential customers.

Champion Brands(high internal and external strength)

They have managed to get both employees and customers infected and enthusiastic about the brand’s values. A representative case of this category is Starbucks. The organization was able to make positive use of the commitment exhibited by the employees as a result of the training and selection efforts of the people who served customers behind the bar.

The Category Of Brands In Danger

Shows high external strength. High brand acceptance by customers is combined with eroding values ​​for employees. Low levels of internal strength are evidenced by low levels of engagement and “brand citizenship.” France Telecom is surely the clearest example of how the erosion of internal brand levels affects, with delayed effects, the valuation of the brand by customers.

Losing Brands

They are generally old brands, with high levels of inconsistency between advertised values ​​and low internal orientation. Marks & Spencer is a good example of a brand eroded both internally and externally that was able to recover the commitment of its employees and redefine its offer in line with a new strategic definition of service.

Although this matrix may show an idealized scenario in which the two dimensions are independent, in reality, they are not. In practice, internal and external strength affect each other and with greater force, if possible, in the services sector.

An Integrating Model Of Brand Value

The growing complexity of service markets calls for a Brand Value model. A more inclusive scheme that measurably incorporates both internal and external aspects and their interaction to create shareholder value.