The Challenges of building Power Brands in Services

Pepsi vs. Coke, Rin vs. Tide, Nokia vs. Samsung, LG vs. Whirlpool, Ford Ikon vs. Hyundai Accent building perceptual differences is the name of the game in brand building. The stories of brands battling it out for consumer share of mind are legendary and generations of marketers have grown up on these. Product features + advertising led image are the fundamental tools that build power brands in products, even in this internet age. Jet vs. Kingfisher, Spice Jet vs. Go Air, Barista vs. Caf Coffee Day, Pizza Hut vs. McDonalds, Lifestyle vs. Shoppers Stop, LIC vs. ICICI, Airtel vs. Hutch (Vodafone) there is another set of brands that are also battling it out for consumer share of wallet and share of heart. Some of these service brands are battling it out on experience while others are focusing on advertising image. A more interesting question, however, is the relative power of the product brands vis--vis the service brands. In Interbrands 2007 ranking of global brands by brand value, in the top 20 list there are 12 product brands and 7 services brands; and in the top 50 list there are 36 product brands and 21 services brands. While services businesses contribute way more to the global GDP, when it comes to brand value, product brands significantly outperform services brands. Interbrand has not yet brought out a list of Indias top brands by value. But, if they did, one wonders whether the service brands would have a place close to the product brands or would they be far behind? This is not an academic or rhetorical question. With Indias economy rapidly transforming itself to a services led one and the billions of rupees of investment intended for the new sectors (financial services, organized retail, media, entertainment, lifestyle etc), the imperative to build power brands in Services is strong. However, this begs the question whether service brands should be built the same way as product brands. If not, then what are the differences between brand building in products and in services? A brand is the sum of tangible and intangible values and associations that differentiate it from other available offerings in the market. Products are made in the factory but brands are made in the minds of consumers. The task of product branding is to build intangible values and associations around the tangible product in order to differentiate it from physically identical products that are available. Thus a Nokia branded cell phone suggests something different to a buyer and owner than a Samsung branded cell phone, even if the quality level and feature set of the two phones are identical. Or detergent powder branded Tide vs. the same powder branded Wheel signal powerful perceptual differences. Emotional benefits, sensory cues and brand personality leveraged in advertising are powerful ways to add layers of emotional meaning and intangible values to the basic product and differentiate it. Product branding is easier than service branding because it is easier to achieve congruence between advertising message and product experience. Since advertising claims are derived from the product itself and product quality is not variable, what consumers expect from the product based on its advertising is what they will experience when they buy the product. This congruence means that it is far easier for product brands to build consumer trust and confidence, the foundation of branding On the other hand, services are intangible. They are experienced only at the various points of delivery, in real time, as they are being delivered. There is also significant variability in service delivery that a customer experiences even from the same service provider at various points in time. Perceptions of service differentials are built more through actual experience

than through advertising. Hence the task of branding services is not to add more intangibility through advertising emotional benefits and brand personality. On the other hand, the critical task of services branding is to bring tangibility to the intangible. It is to create markers at each point of service delivery that highlight the brand differentiators. These markers when noted, remembered and talked about by consumers build perceptual differences between service brands. Thus the task of service branding is the very opposite of product branding. In the Kingfisher vs. Jet instance, the King of Good Times brand concept of Kingfisher has been translated into a number of tangible differentiators at all stages of service delivery. From referring to passengers as guests to greeting passengers upon entry to the airport and carrying their luggage, from the glamorous red uniforms of the stewardesses to the in-flight entertainment, there are markers to be noted, remembered and talked about. There is far greater variability in service delivery creating mismatch between advertising claims and actual service experience. This leads a number of service brands to focus on broad emotional theme led communication which dont make any specific claims related to service quality. As with products, the expectation is that such advertising will build salience and affinity for the service brand, but the ROI of such investment for a service brand will certainly be far lower than for a product brand. While advertising is relevant and can be helpful for service brands, there are many powerful services brands that have been built with little or no investment in advertising. Starbucks and Google immediately come to mind. This is because, service brands are best built bottom up leveraging experiential differentiators rather than top down, via advertising campaigns.