Brand assets are difficult and expensive to develop, maintain, and adapt. The offering environment is cluttered, confused, and complex in part because of the proliferation of products, brands, and sub-brands. Dynamic market contexts with the emergence of new sub-categories make it necessary to adapt and stretch brands, putting additional strain on their ability to deliver the needed support. In this context, the corporate brand (or, more generally, an organization brand) can be dialed up to play a more prominent role in the brand portfolio. The corporate brand defines the firm that will deliver and stand behind the offering that the customer will buy and use. The brand has access to organizational as well as product associations and the flexibility to play several roles within the brand portfolio. Of most significance is its potential in some contexts to be a master brand with a significant driver role. In fact, in the case of Dell, UPS, Sony, Samsung, IBM, and others, it can been seen as the ultimate branded house, where the product brands consist largely of the corporate brand plus a descriptor. In these cases, the use of a corporate brand as a master brand maximizes brand portfolio goals such as generating leverage, synergy, and clarity.

The authors assess the extent to which brand attitude, a key component of brand equity, has value relevance—that is, helps predict future earnings and thus firm value—in high-technology markets. Using data for firms in the computer industries, the authors find that changes in brand attitude are associated contemporaneously with stock return and lead accounting financial performance. The study also provides insights into the drivers of brand attitude. The authors find that both product attributes and peripheral cues shape brand attitudes in high-technology markets.

As more and more companies begin to see the world as their market, brand builders look with envy upon those businesses that appear to have created global brands--brands whose positioning, advertising strategy, personality, look, and feel are in most respects the same from one country to another. Attracted by such high-profile examples of success, these companies want to globalize their own brands. But that's a risky path to follow, according to David Aaker and Erich Joachimsthaler. Why? Because creating strong global brands takes global brand leadership. It can't be done simply by edict from on high. Specifically, companies must use organizational structures, processes, and cultures to allocate brand-building resources globally, to create global synergies, and to develop a global brand strategy that coordinates and leverages country brand strategies. Aaker and Joachimsthaler offer four prescriptions for companies seeking to achieve global brand leadership. First, companies must stimulate the sharing of insights and best practices across countries--a system in which "it won't work here" attitudes can be overcome. Second, companies should support a common global brand-planning process, one that is consistent across markets and products. Third, they should assign global managerial responsibility for brands in order to create cross-country synergies and to fight local bias. And fourth, they need to execute brilliant brand-building strategies. Before stampeding blindly toward global branding, companies need to think through the systems they have in place. Otherwise, any success they achieve is likely to be random--and that's a fail-safe recipe for mediocrity.

The classic brand manager dealt with simple brand structures in part because he or she was faced with a relatively simple environment and simple business strategies. Today the situation is far different. Brand managers now face market fragmentation, channel dynamics, global realities, and business environments that have drastically changed their task. In addition, there is pressure to leverage brand assets because of the prohibitive cost of creating new brands. This set of challenges has created a new discipline called "brand architecture." A coherent brand architecture can lead to impact, clarity, synergy, and leverage rather than market weakness, confusion, waste, and missed opportunities. Brand architecture is an organizing structure of the brand portfolio that specifies brand roles and the nature of relationships between brands. This article introduces a powerful brand architecture tool, the "brand relationship spectrum." It is intended to help brand architecture strategists employ insight and subtlety to subbrands, endorsed brands, and their alternatives. Subbrands and endorsed brands can play a key role in creating a coherent and effective brand architecture.

When markets turn hostile, it's no surprise that managers are tempted to extend their brands vertically--that is, to take their brands into a seemingly attractive market above or below their current positions. And for companies chasing growth, the urge to move into booming premium or value segments also can be hard to resist. The draw is indeed strong; and in some instances, a vertical move is not merely justified but actually essential to survival--even for top brands, which have the advantages of economies of scale, brand equity, and retail clout. But beware: leveraging a brand to access upscale or downscale markets is more dangerous than it first appears. Before making a move, then, managers should ascertain whether the rewards will be worth the risks. In general, David Aaker recommends that managers avoid vertical extensions whenever possible. There is an inherent contradiction in the very concept because brand equity is built in large part on image and perceived worth, and a vertical move can easily distort those qualities. Still, certain situations demand vertical extensions, and Aaker examines both the winners and the losers in the game. Managers may find themselves facing a situation that presents both an emerging opportunity and a strategic threat, and alternatives to vertical extensions may have even higher risks and costs. Furthermore, a number of brands have been extended vertically with complete success. If after assessing the risks and rewards you conclude that a vertical extension is on the horizon, proceed with caution. And keep in mind that your challenge will be to leverage and protect the original brand while taking advantage of the new opportunity.

Costs, market fragmentation, and new media channels that let customers bypass advertisements seem to be in league against the old ways of marketing. Relying on mass media campaigns to build strong brands may be a thing of the past. Several companies in Europe, making a virtue of necessity, have come up with alternative brand-building approaches and are blazing a trail in the post-mass-media age. In England, Nestlé's Buitoni brand grew through programs that taught the English how to cook Italian food. The Body Shop garnered loyalty with its support of environmental and social causes. Cadbury funded a theme park tied to its history in the chocolate business. Häagen-Dazs opened posh ice-cream parlors and got itself featured by name on the menus of fine restaurants. Hugo Boss and Swatch backed athletic or cultural events that became associated with their brands. The various campaigns shared characteristics that could serve as guidelines for any company hoping to build a successful brand: senior managers were closely involved with brand-building efforts; the companies recognized the importance of clarifying their core brand identity; and they made sure that all their efforts to gain visibility were tied to that core identity. Studying the methods of companies outside one's own industry and country can be instructive for managers. Pilot testing and the use of a single and continuous measure of brand equity also help managers get the most out of novel approaches in their ever more competitive world.

This article presents managers with a framework for measuring the strength of a brand. It specifically examines ten sets of measures grouped into five categories: loyalty perceived quality, associations, awareness, and market behavior. Employing these measures can be difficult and their results must be used carefully. However, they have the capacity to provide managers with a set of important and extremely useful measurement tools.

The authors investigate whether movement in a firm's stock price, that is, a measure of firm value, is associated with information contained in perceived quality measures. In a model that also allows for the effect of economywide factors and a firm's return on investment, they find a positive relationship between stock return and changes in quality perceptions. These results imply that the quality measure contains information, incremental to that reflected by current-term accounting measures, about future-term business performance. They suggest that managers should convey information to the stock market, such as the brand's quality image, useful in depicting the long-term prospects of the business. By doing so, the stock market will rely less on short-term measures of business performance, and managers will be freer to undertake strategies necessary for ensuring the long-term viability of their firms.

Within its first two years, Saturn created one of the strongest automobile brands. This article explains how and why GM was able to accomplish this unique feat. It involved creating a world-class product, developing a team-oriented organization outside the GM fold, selling the company not the car, creating a new retailing strategy and relationship with the customer, and a consistent communication effort. Ironically, Saturn's success raises difficult strategic issues as to its future management and its role in the future of General Motors.

A laboratory experiment examines factors affecting evaluations of proposed extensions from a core brand that has or has not already been extended into other product categories. Specifically, the perceived quality of the core brand and the number, success, and similarity of intervening brand extensions, by influencing perceptions of company credibility and product fit, are hypothesized to affect evaluations of proposed new extensions, as well as evaluations of the core brand itself. The findings indicate that evaluations of a proposed extension when there were intervening extensions differed from evaluations when there were no intervening extensions only when there was a significant disparity between the perceived quality of the intervening extension (as judged by its success or failure) and the perceived quality of the core brand. A successful intervening extension increased evaluations of a proposed extension only for an average quality core brand; an unsuccessful intervening extension decreased evaluations of a proposed extension only for a high quality core brand. Though a successful intervening extension also increased evaluations of an average quality core brand, an unsuccessful intervening extension did not decrease core brand evaluations regardless of the quality level of the core brand. The relative similarity of intervening extensions had little differential impact, but multiple intervening extensions had some different effects than a single intervening extension.

California, where many Japanese firms operate in the retail service sector, provides a laboratory to examine the extent to which the high levels of personal service that are routinely achieved in Japan have been exported to the United States. The eight Japanese firms examined in this study have not implemented the Japanese approach to service in the U.S. because they believe that the nature of the workforce and environment make its implementation infeasible and because they do not believe it to be cost effective. Rather, the Japanese compete very much like U. S. firms with respect to personal service.

Two studies were conducted to obtain insights on how consumers form attitudes toward brand extensions, (i.e., use of an established brand name to enter a new product category). In one study, reactions to 20 brand extension concepts involving six well-known brand names were examined. Attitude toward the extension was higher when (1) there was both a perception of “fit” between the two product classes along one of three dimensions and a perception of high quality for the original brand or (2) the extension was not regarded as too easy to make. A second study examined the effectiveness of different positioning strategies for extensions. The experimental findings show that potentially negative associations can be neutralized more effectively by elaborating on the attributes of the brand extension than by reminding consumers of the positive associations with the original brand.

AbstractA procedure for identifying strategic groups based on mobility barriers is recommended and illustrated. The strategic groups identified were observed to exhibit group membership stability and differences in profitability.

Long-term success involves creating, managing, and exploiting assets and skills that competitors find difficult to match or counter. This involves a three-step process. The first step is to identify relevant skills and assets by observing successful and unsuccessful firms, key customer motivations, large value-added items, and mobility barriers. The second step is to select those skills and assets that will provide an advantage over competitors, will be relevant to the market, and will be feasible, sustainable, and appropriate for the furture. The third step is to develop and maintain those assets and skills and to neutralize those of competitors.

AbstractThis article develops an analytical and empirical framework for examining strategy over the business cycle. Firms were observed to adjust their strategies significantly and asymmetrically over business cycle stages. There was no consistency in performance between up markets and down markets. A variable‐parameter profitability model of strategy in a cyclical industry suggested the importance of a strategy's contemporaneous and inter‐temporal relationships with performance. Discrepancies were observed between actual strategies and optimal strategies over business cycle stages.

Journal Article Are All the Effects of Ad-Induced Feelings Mediated by A Ad ? Get access Douglas M. Stayman, Douglas M. Stayman Search for other works by this author on: Oxford Academic PubMed Google Scholar David A. Aaker David A. Aaker Search for other works by this author on: Oxford Academic PubMed Google Scholar Journal of Consumer Research, Volume 15, Issue 3, December 1988, Pages 368–373, https://doi.org/10.1086/209173 Published: 01 December 1988 Article history Received: 01 September 1986 Revision received: 01 April 1988 Published: 01 December 1988

This study examined the role of risk in explaining cross-sectional differences in the profitability of business units. Applying suggestions of financial theory, we disaggregated risk into two components-systematic and unsystematic-that are thought to have different effects on return. Drawing on the PIMS data base, we found each component of risk to have a substantial, significant, and different impact on return on investment (ROI). The research and strategy implications of the roles of risk are discussed. The two key factors in any investment decision are return and risk. Under the assumption that investors are risk-averse and seek to minimize the risk for any level of expected return, intuition suggests that additional return must compensate investors for assuming additional risk. Scholars in finance and other disciplines have devoted a great deal of work to refining and formalizing this intuition. This same logic applies in the context of strategy, as Wensley (1981), Bettis and Mahajan (1985), and others have observed. A strategic investment decision should explicitly consider risk-decision makers should demand a higher return for an investment involving high risk. Yet, in typical practice, strategic investment decisions are adjusted for risk ad hoc, if at all. Firms typically set relatively high hurdle rates in making go/no go investment decisions and apply these rates to all investments, regardless of their riskiness (Hayes & Gavin, 1982). Further, historical evaluation of existing strategies, whether it concerns evaluating present management or attempting to place values on businesses to be divested or acquired, focuses almost exclusively on return and rarely attempts to quantify risk. These failures to account for risk adequately will unquestionably lead to inappropriate decisions. All else being equal, if firms judge business performance only in terms of return, regardless of risk, they will place more resources than warranted in risky strategies, forgo profitable opportunities, and apply misguided performance evaluations. Further, if researchers do not control for risk in studies assessing the effects of strategic factors on We would like to thank the Strategic Planning Institute for providing access to the data used in this study.