Susan Fournier

Consumers and Their Brands: Developing Relationship Theory in Consumer Research

Although the relationship metaphor dominates contemporary marketing thought and practice, surprisingly little empirical work has been conducted on relational phenomena in the consumer products domain, particularly at the level of the brand. In this article, the author: (1) argues for the validity of the relationship proposition in the consumer-brand context, including a debate as to the legitimacy of the brand as an active relationship partner and empirical support for the phenomenological significance of consumer-brand bonds; (2) provides a framework for characterizing and better understanding the types of relationships consumers form with brands; and (3) inducts from the data the concept of brand relationship quality, a diagnostic tool for conceptualizing and evaluating relationship strength. Three in-depth case studies inform this agenda, their interpretation guided by an integrative review of the literature on person-to-person relationships. Insights offered through application of inducted concepts to two relevant research domains — brand loyalty and brand personality — are advanced in closing. The exercise is intended to urge fellow researchers to refine, test, and augment the working hypotheses suggested herein and to progress toward these goals with confidence in the validity of the relationship premise at the level of consumers’ lived experiences with their brands.

Reviving brand loyalty: A reconceptualization within the framework of consumer-brand relationships

Abstract This paper uses the perspective of interpersonal relationship theory to critically examine, reposition, and extend the notion of brand loyalty. Depth interviews among eight coffee-consuming adults who qualified as brand loyal by traditional criteria provide the data. The result is a deeper appreciation of the character of loyal consumer-brand relations and a sharper awareness of the limitations to understanding that current theoretical frameworks impose. Specifically, the authors suggest that: (1) not all loyal brand relationships are alike, in strength or in character; (2) many brand relationships not identified as ‘loyal’ according to dominant theoretical conceptions are especially meaningful from the cunsumers point of view; and (3) current approaches to classification accept some brand relationships that, upon close scrutiny, do not possess assumed characteristics of ‘loyalty’ or ‘strength’ at all. Ideas stemming from a reframing of loyalty as one component in a multifaceted construct of relationship strength are put forth, encouraging a move from the metaphor of ‘loyalty’ to the broader notion of ‘relationships’ that encompasses it.

Brands matter: An empirical demonstration of the creation of shareholder value through branding

This research responds to the attendant need for empirical evidence pertaining to how marketing affects firm performance. Using the Fama-French method, common in finance, and a leading marketplace measure of a brand’s financial equity value, the authors provide empirical evidence for the branding-shareholder value creation link. The results extend previous research by showing that strong brands not only deliver greater returns to stockholders than does a relevant benchmark but do so with less risk This finding holds even when market share and firm size are considered.

Branding and Firm Value

Branding is widely recognized as an important marketing activity, yet marketing executives are challenged to prove the value of branding in clear financial terms. The objective of this chapter is to integrate emerging insights from the literature on branding and shareholder value into a process framework that helps enumerate and explain the brand-finance link. This chapter begins by discussing the reasons why using shareholder value (i.e., stock returns and risks) is an appropriate metric to assess brand performance and brand equity value. The authors introduce common metrics of shareholder value (e.g., Tobin’s q, abnormal returns, and idiosyncratic risk) and three distinct metrics of brand equity: customer, product-market, and finance-based. Next, the chapter delineates the mechanisms that govern the branding-finance interface to address whether and how branding affects shareholder value; key findings from the extant literature on branding and shareholder value are summarized to support these process routes. In conclusion, the chapter considers three antecedents of brand-equity creation, again reviewing extant literature to qualify effects on firm value and cash flow: organization-level strategy (e.g., corporate name strategy, mergers & acquisition), brand strategy (e.g., brand extensions and brand portfolio strategy) and brand management tools (e.g., advertising). The chapter concludes with an agenda for future studies that address gaps and challenges in this important and growing area of research.

Editorial: Brand Risk

Every light has its shadow. Most people, though, prefer the sunny and bright side over shades and darkness, and so do most marketers, according to our experience. Typically, brand building is associated with big opportunities, higher returns, and increased shareholder value – the sunny side. This is what brand managers are trained for and talk about. But opportunities do not come without risks, and marketing as a discipline has tended to leave the focus on this darker side to finance and accounting control. But ignoring or facing brand-related risks too late can entail a loss of revenues, cash flow decline and volatility, brand equity erosion, and lower shareholder value. Only recently have marketers entered the risk conversation. Our position is that if markets want to proactively manage the specific risks that brand management decisions involve, they need to understand the nature, sources and dynamics of these risks.

The Frontlines of Brand Risk

Abstract Whether it be the NFL, Dove, Wells Fargo, VW or countless others–managers need only open a daily newspaper to see how things can go terribly wrong for brands. Decline can be fast and the landing hard. In a contemporary marketplace where ideologies reign and social media guarantees the spread of (mis)information at light speed, a lot of what we think we know about brand marketing needs to be rethought through a risk-management lens. “For me, brand risk is any event, action or condition with the potential to damage a brand’s value, thereby making revenue generation and a company’s market value less than it should or could have been,” Patrick Marrinan, Managing Principal of Marketing Scenario Analytica, states. In his talk with Susan Fournier and Shuba Srinivasan, Patrick illustrates the many facets of a risk that has only begun to be recognized as a serious threat to carefully cultivated brand assets. Here we share what to watch out for and what brands can do to protect against risk.

At-Risk Brand Relationships and Threats to the Bottom Line

Abstract Like a stock portfolio, each relationship type offers a brand higher or lower growth opportunities and risks. The type of relationship is particularly relevant in brand crisis events. When a brand is hit by a crisis, it is not necessarily the most successful strategy to focus exclusively on protecting positive emotional relationships. At-risk relationships are affected more than others and can lead to a significant decline of brand value. Our cases highlight that at-risk relationships represent a critical, but often overlooked, aspect of a brand’s relationship portfolio. Risks range from negative word of mouth that might have a negative impact on potential new customers to clear retention risk. Marketers should manage these risks proactively by identifying and investigating the nature of their customer relationships and by responding frankly and credibly to crisis events.

Branding and the Risk Management Imperative

Abstract In an increasingly risky socioeconomic environment, management needs to proactively consider brand-related risks. To understand brands as tools for risk management, they need to understand four types of brand risk: brand reputation risk, brand dilution risk, brand cannibalization risk and brand stretch risk. Risk management is not a natural act for brand managers trained in astute execution of the 4 Ps, and contemporary market factors make this more challenging still. With an increasingly polarized society, it is almost impossible for brands to remain untouched by ideologies. In addition, the growth in digital advertising gives brand managers less control over advertising placement and context, and the mandate to keep growing adds executional risk. The more exposed a brand is to brand risk, the more attention this topic will need in the boardroom. To shift a company’s marketing philosophy toward risk, it is important to define marketing competences in a broader way, to be self-critical and to be proactive.

Contemplating the futures of branding

The creation and implementation of an intended brand personality has become a prevailing topic, both for practitioners and researchers. Especially in luxury industry, where brands hold a strong symbolic meaning, marketers are faced with the challenge of successfully establishing an intended brand personality and turning it into a realized brand personality among consumers. However, research identifying drivers for successful brand personality implementation is scarce. Therefore, the aim of this chapter is to first identify factors which influence duality of the brand personality concept by accounting for both the intended and the realized brand personality perspective and factors that influence the fit between the two perspectives. Second, we will focus specifically on brand personality implementation strategies that involve the interplay between strategic considerations of brand managers, the corresponding implementation activities, as well as the customer’s perspective. We will integrate the results of an exploratory qualitative study that compiled interviews with luxury marketing managers in Switzerland.