2. 646 Leslie de Chernatony and Susan Segal-Horn
Cunningham, Young and Lee 1997), with little about implications for services
branding.
This paper is concerned with understanding how to capitalise on
knowledge about the unique characteristics of services to develop successful
services brands. We do not seek to refine the categorisation of products
versus services, but rather how knowledge about the unique characteristics
giving rise to the dichotomy can be used to develop services brands. As such
the paper opens by addressing the classical differences between products
and services. It then reviews the limited literature about services branding
then draws on this to argue the need for a services branding model
indicating the importance of staff as brand builders. We undertook in-depth
interviews with 28 services brands consultants, asking them about any
differences they saw between product and services brands to get at the core
issue of how this can be used to grow services brands. By integrating their
insights with the literature we seek to draw inferences about developing
successful services brands.
Literature Review
Product-services Dichotomy Implications for Services Branding
The debate about the product-services dichotomy continues (Blankson
and Kalafatis 1999). Much attention has involved strengthening a theoretical
case that services are conceptually different from products (Murray and
Schlater 1990) and a series of characteristics unique to services have been
reported. These include intangibility, inseparability of production and
consumption, heterogeneity of quality and perishability (Rathmell 1966;
Shostack 1977; Grönroos 1978; Bateson 1995). As these characteristics are
discussed in detail in the literature, it may be helpful to consider a few
implications for services brands.
One way of overcoming the problem of intangibility, as McDonald’s
exemplifies, is through the importance of the company as a brand, reinforced
by a well presented corporate identity to evoke clear functional and
emotional values (Diefenbach 1992). Rather than regarding inseparability of
production and consumption as a challenge it can be interpreted as an
opportunity (Norman and Ramirez 1994; Onkvisit and Shaw 1989) to regard
consumers as co-producers of value and thus be able to tailor the brand to
their needs. An approach to reducing heterogeneous quality is to recruit
staff whose values align with the brand (Kunde 2000) then reinforce these
values through organisational artefacts (Schein 1984) and frequent training
(Lovelock, Vandermerwe and Lewis 1999). The issue of perishability affects
brands in sectors such as pensions where brands are bought in advance of
the benefit. However, the threat of competitors’ enticements before the
3. Building on Services’ Characteristics 647
brand matures can be countered by building favourable reputations
(Fombrun 1996).
The literature further questions whether there are pure products or pure
services (Shostack 1977; Grönroos 1978), or simply offerings on a continuum
(Rathmell 1966). This suggests brands have a greater or lesser services
component. Levitt’s (1981) work supports this, as he argues customers don’t
buy products or services, but rather clusters of value expectations. These
clusters are an amalgam of tangible and intangible components, cf. the
functional and emotional values in the case of brands.
Although the classic characteristics indicate the need for a different
approach executing a services branding strategy, they do not suggest that the
concept of a brand as a cluster of functional and emotional values is different
between product and services sectors. Indeed earlier research (de
Chernatony and Dall’Olmo Riley 1999) found empirical support for branding
principles being the same at the conceptual level; it is in the execution that
differences emerged.
The unique characteristics of services have been much discussed. The
purpose of this paper is not to revisit these service characteristics per se but
to explore their implications for branding. In particular we argue the case for
a separate model for services branding as distinct from product brands. We
would agree that much of the argument may come back to the idea that
services brands are intangible – in fact all brands are intangible. However,
the point is that services brands represent something that is intangible, while
product brands represent something tangible.
We recognise that elements of the ‘unique’ characteristics of services
organisations are also present in product organisations. Indeed this
questioning of an absolute product-service divide forms part of the analysis
of spectrum-based categorisations of brands discussed later in this paper.
One of the most obvious ways of challenging the uniqueness of particular
service characteristics is with regard to the characteristic of intangibility. It is
clear that most supposedly intangible service organisations also involve large
elements of tangible resources as well. An airline cannot function without
major tangibles such as the planes, check-in desks, plastic trays for meals,
and so on; similarly for hotels, schools and restaurants. There are therefore
very few pure services. In terms of our argument for a separate services
branding model however, this misses the point.
The relevance of intangibility in service organisations is not the
proportion of intangibles to tangibles required to provide the service. It is
instead about the way that good customer service is achieved and how the
expectations of the brand promise are fulfilled. For a service organisation
this occurs through another key characteristic of services: the inseparability
of production and consumption. Delivery of the services brand is about the
4. 648 Leslie de Chernatony and Susan Segal-Horn
experience of the customer at the interface with the service provider,
commonly described as the ‘service encounter’ (Bowen, Chase and
Cummings 1990). The service encounter is dependent upon the attitudes and
motivation of the service organisation’s staff, irrespective of the balance
between tangible and intangible resources in the specific service
organisation. Services brands therefore depend critically upon the
understanding of, and commitment to, the brand and the brand values by the
staff of the service organisation and the process by which the service
organisation achieves this. For example, friendly, helpful and well-informed
staff are the embodiment of the airline, bank or hotel brand in the experience
of the customer. It is this living embodiment and enactment of the brand that
a model of service branding must capture.
Services Branding Literature: Shifting the Focus to Internal Branding
The previous section implied services branding needs to be more attentive
to internal issues than is the case with product branding. A review of the
limited literature on services brands reinforces this.
An increasingly common interpretation of “brand” which applies to
services considers a brand as a promise (e.g. Berry 2000; Ward, Light and
Goldstine 1999; Mistry 1998; Ambler and Styles 1996). For example, Ambler
and Styles (1996) define a brand as “the promise of the bundle of attributes
that someone buys ….. the attributes that make up a brand may be real or
illusory, rational or emotional, tangible or invisible” (p.10). Thus the global
branding of The Body Shop promises personal care products which have not
been tested on animals. This again reinforces the conceptual similarity of
brands in product and services sectors as clusters of functional and emotional
values. However, if a promise is to be appreciated, the expectation and the
perceived delivery must match. An appreciation of the executional
difference between services and product brands is crucial here. Some
marketers, interpreting services brands as promises, draw heavily on the
classical product branding model and focus predominantly on consumers,
raising expectations through advertising. Less emphasis is placed on internal
communication, ensuring staff understand the brand’s promise and can
consistently deliver this. British Airways was very aware of the importance
of internal communication with such a globally dispersed workforce facing
an even more competitive environment with the growth of budget carriers.
Attentive to the need for staff to understand the brand’s promise, they have
put considerable resources into internal communication programmes. Given
the change of Chief Executive in 2000, it remains to be seen how effective this
internal campaign was.
The services brand promise gap can be narrowed by minimising four
company gaps (Zeithaml and Bitner 1996). Provider gap 1, not knowing
5. Building on Services’ Characteristics 649
what consumers expect, can be reduced through greater understanding of
consumers and provider gap 2, not selecting the right service design
standards, can be minimised through stronger service leadership and better
defined standards. The impact of provider gap 3, not delivering to service
standards, can be lessened by redesigned service delivery systems and more
appropriate human resources policies, while provider gap 4, not matching
performance to promises, can be reduced through not over promising and
having more effective internal communications.
Executing a services branding strategy is different because successful
services brands do not focus just on consumers, but rather on stakeholders,
especially staff (Denby-Jones 1995). Classical product branding assumes an
internal value delivery system, internally quality controlled and unseen by
consumers. By contrast the value delivery system for services brands is
externally visible, involves consumers as active participants and is subject to
quality variability.
This problem can be turned into an opportunity. As Grönroos (1990)
explained, consumers’ perceptions of services quality consists of what they
get (technical outcome) and how they get it (process). In some sectors,
particularly financial services, branding activity concentrated on the
technical outcome and differentiation is sparse (Farnfield 1999). Other
services organisations, for example the telephone and internet banking
subsidiary of HSBC Bank, First Direct, deliberately focused on recruiting staff
whose values concur with the desired organisational culture and who are
committed to behaving in a way associated with the brand promise. In its
formative years, this strategy of majoring on a once unique staffing policy
helped the growth of First Direct. This emphasis on the process results in
services brands being more about the way things are done internally (Free
1999), encouraging a culture whereby staff recognise how they should
interact with consumers, providing a basis for sustainable differentiation.
Levitt (1976) proposed greater industrialisation of services processes, by
replacing human activities with technology and thus reducing the
heterogeneity of quality problem. An example of this would be McDonald’s
where technology takes precedence over employees and the service process
is designed to give little discretion to employees’ behaviour (Kunde 2000).
Managers can use services blueprints (Shostack 1987), to assess where
technology can replace routine human tasks. Free (1999) argued against the
wholesale replacement of staff by technology, believing that competitive
advantage can be gained by releasing staff from routine tasks to concentrate
on non-routine problems. A mechanistic approach can demotivate good staff
and attract employees unable to respond to atypical consumer requests. By
contrast, a humanistic perspective focuses on appropriate culture. As Kotter
and Heskett (1992) reported, there is a likelihood of better performance
6. 650 Leslie de Chernatony and Susan Segal-Horn
where staff are aware of, and aligned with, their organisations’ values.
Successful services brands, such as Disney, have clear values (Jones 1999),
which consumers and staff understand. Comprehending these values, and
the implications for their roles, reduces employee stress and increases
commitment to delivering the service brand (Heskett 1987). Successful
services brands depend on good internal communication programmes
(Cleaver 1999) enabling greater consistency of delivering, regardless of
consumers’ points of contact (Camp 1996). Singapore Airlines is a good
example of this, using frequent internal communication programmes to keep
staff informed and encouraging cabin crew to learn the names and special
needs of business and first class passengers, enabling staff to deliver their
brand’s promise. Recruiting staff with the right values, and having well
designed induction and training programmes creates greater commitment,
which is an important component in services brands (Thomson, de
Chernatony, Arganbright and Khan 1999; Farnfield 1999). Southwest
Airlines was able to establish itself against entrenched competitors by
adopting these policies enabling it to have the competitive advantage of
committed staff.
Understanding corporate culture and heritage, as for example Virgin,
helps managers identify principles that give the brand a genuine basis for a
consumer valued positioning (Camp 1999). The challenge is ensuring this
attitude is evident at every point of contact. Distinctiveness for a product
brand is often derived from consumer market research, but for services
brands often only category values emerge (Camp 1999) rather than unique
brand values (de Chernatony and Harris 2000). Understanding an
organisation’s principles is one way to devise a credible cluster of unique
brand values. The Co-operative Bank majors on its century old founding
value of social responsibility rather than the category value of security, much
used by other competing banks. The Body Shop, the international personal
care products retailer, ascribes part of its early success to its unique value of
respecting the environment, rather than the category value of beauty
employed in many competitors’ strategies.
Experience enables consumers to understand services brands,
encouraging the formation of relationships (Cleaver 1999). Strong brands
have respected consumer relationships (Aaker 1996), for example the
genuine warmth at Marriott, the international hotels group, has helped
strengthen this brand. The absence of strong services brands, particularly in
financial services (Camp 1996), indicates these relationships are
underdeveloped compared to product brands (Fournier 1998). The fact that
consumers do not switch banks is not an indication of a loyal relationship,
but of inertia (Jones 1999).
One of the more common routes for consumers to form relationships with
7. Building on Services’ Characteristics 651
brands is through advertising building a personality for the brand (Fournier
1998). However, because of the more dominant impact from consumers
interacting with staff in services brands, consumers’ relationships with the
brand come both from advertising and the behaviour of staff. By recruiting
staff whose values align with those of the services brand, their behaviour
should encourage consumers to develop a relationship with the brand that is
reinforced by the brand’s advertising.
Research Aim and Method
In view of the limited research on services brands we sought to go beyond
the services-product dichotomy and understand how services brands can be
developed through knowledge of the inherent characteristics of services. As
such we asked “What do you see as being the difference between services brands
and product brands, if any?” in a series of in-depth interviews to get at the core
of how these characteristics can be used to develop service brands. We
focused on senior consultants advising clients globally about services
branding, since they are at the forefront of application, have gained
considerable knowledge and experience and are influencing tomorrow’s
services branding agenda.
Our research was exploratory in nature, seeking to appreciate consultants’
views within their frames of reference, without imposing our preconceptions.
The most appropriate method was in-depth interviews (Goodyear 1996;
Gilmore and Carson 1996). We identified consultancies based in the UK in
branding, advertising, design, marketing/management and market research
respected for their branding expertise. We either wrote to the
Chairman/Managing Director where we did not know the name of the most
senior services branding consultant, or approached consultants directly.
Consultancies were selected for their high profile in the services branding
press, frequent presence at branding conferences, books or papers written, or
expert recommendation. We also interviewed a management journalist
respected for his visionary ideas about brand management. Of these 28
interviews (typically Chairman, Managing Directors or Directors), our
sample consisted of 10 consultants in advertising, 5 in brand consultancies, 5
in design, 4 in marketing/management consultancies, 3 in market research
agencies and a management journalist.
All the consultancies, and thus the interviews, were in the UK. The
conceptual issues this paper explores have not generally been treated in the
services literature as culturally specific. The literature review cites work that
has been published in Europe and the USA and these tended to arrive at
similar conclusions, e.g. Grönroos (1978) and Shostack (1977). In view of this
we felt it appropriate to conduct the interviews in UK.
8. 652 Leslie de Chernatony and Susan Segal-Horn
The in-depth interviews were recorded, then transcribed. Respondents were
encouraged to talk as much, or as little as they wished, only probing to seek
clarification and to explore in detail their comments.
Content analysis (Krippendorff 1980) was conducted independently by
both authors. Within the context of the aims stated above, and following
Miles and Huberman’s (1994) framework, we noted patterns and themes in
the data, drew links with previous literature and added categories for new
themes. We then compared our analyses relative to the aims, and the
coefficient of agreement was calculated at 89%. Inter-research differences
were resolved through discussion and reference back to the transcriptions as
suggested by Miles and Huberman (1994).
Findings
Alternative Ways of Categorising Brands
Our literature review, which found little on services branding and the
inappropriateness of the classical product branding model in services, was
confirmed by several respondents. Opening comments included: “It’s good
you are doing this study because it’s amazing how little work has been done on
services branding” (Advertising Consultant 6); “There is no reason to think there
is just one model of branding, and the issue in my mind is that the packaged goods
model of branding doesn’t apply to all businesses” (management journalist).
Everyone was asked “What do you see as being the difference between services
and product brands if any?” While all 28 spoke about differences, a minority
(9) did not see a clear-cut divide (cf. Shostack 1977). Four remarked that a
brand is a brand, regardless of its form, summarised by Market Research
Consultant 1 as, “the difference is between service and product, forget the brand
bit”. They regarded brands as clusters of values, or associations in
consumers’ minds, which emerge regardless of form (cf. Levitt 1981) and it
was more important to define benefits rather than form. Marketing
Consultant 2 argued that both services brands and product brands are a
“bundle of representational and functional characteristics, it’s the process of
branding which is different”.
Useful ways of categorising brands were given, which provide insights
about developing services brands. We explore these in terms of
categorisations based on either a spectrum or differences of kind. A reason
for these variations came from Brand Consultant 2 who observed that “the
whole area of services branding is so much newer and there is not an established
model in the same way as FMCG has its own models”.
Spectrum Based Categorisations
Concurring with the earlier literature review noting the absence of a pure
products-services divide but rather a continuum, several consultants talked
9. Building on Services’ Characteristics 653
about a spectrum. For example “It seems clear that we have an ecology of brands
…. and we don’t know yet how to tell the difference between the big cat and the
gazelle, and that’s because there’s a spectrum” (management journalist). Those
who argued for a brands spectrum, mentioned a variety of dimensions.
One spectrum distinguished between services brands where consumers
have high contact and a deep experience, scaling down to brands with which
consumers have a low frequency of contact and a superficial experience. In
the former case majoring on the experience should help the brand grow,
while in the latter case the quality of contact is more fundamental. Given the
problems banks are having trying to establish themselves as brands,
Advertising Consultant 1 interestingly regarded banks falling in the low
contact, superficial experience domain.
A common theme was categorising brands according to the extent to
which they involved consumers in an experience. In a product centred
brand, values are more controlled by the manufacturer. For experiential
brands, values depend on interactions between consumers and staff,
resulting in a less easily definable cluster of values, albeit recruiting staff
whose values align with the brand’s values can reduce inconsistencies.
A different spectrum was based on duration of consumption. At one
extreme are brands instantly consumed at the point of delivery, for example
restaurants, while at the opposite end are brands consumed over a
considerable time, for example education or health care. Regular staff
training helps face the challenge of ensuring consistency over time.
Co-operative Disney
High
Bank The Body Shop
Emphasis on
representational
values
Kwik-Fit
Low
IKEA
Low High
Emphasis on functional values
Figure 1. Representational vs Functional Matrix
10. 654 Leslie de Chernatony and Susan Segal-Horn
Marketing Consultant 2 used the two dimensional matrix in figure 1. This
categorised brands by the extent to which they stressed functional and
representational (emotional) values. Knowing where the brand currently
resides and where it should be provides a basis for developing suitable
strategies by changing the emphasis of the two dimensions on the brand (cf.
de Chernatony 1993).
In another matrix, shown in figure 2, the vertical plane assessed the
degree to which economies of scale could be achieved by standardising
repetitive human tasks, whilst the horizontal plane gauged the degree to
which services brand interactions with consumers result in committed
relationships. For airlines typically there is high standardisation, in the
context of airports and airplanes, and low personalisation, resulting in little
commitment to the relationship. By contrast, a personal trainer cannot
standardise actions with clients and there is a committed relationship. This
suggests brands predominantly emerge in sectors which offer scope for
achieving economies of scale through industrialising repetitive human tasks.
For example, there is no national brand of home plumbers in the UK, since
the task range is varied and consumer interaction high.
High Airline
Scope for
economies of
scale by
standardising
repetitive tasks
Low Personal Trainer
Low High
Committed relationships
Figure 2. Economies of Scale vs Relationship Matrix
A third spectrum was based on the time it takes consumers to form a
preference. Whereas product brands tend to evoke preferences within short
periods of time, services brands are experiences assessed over longer periods.
In conclusion, some consultants had devised branding typologies that had
11. Building on Services’ Characteristics 655
gone beyond the services-product divide. These were based on spectrums
which characterised brands and also provided guidance about services brand
strategies. The matrices were unique to each consultancy, reflecting their
proprietary philosophy about brands and their creativity. Successful brands
are unique offerings (de Chernatony and McDonald 1998) and the variety of
categorisations facilitated consultants’ abilities to differentiate their brands.
Differences of Kind Rather than Degree
Seven consultants had categorisations that abhorred a spectrum. As
Brand Consultant 2 said “one of the dangers of talking about services brands and
using the same language as product brands is an assumption that they’re differences
of degree, whereas actually they’re differences of kind”. He argued that some
brands (usually product brands) are serial, one-off relationships existing only
for short periods as the brand is repeat purchased, while other brands
(usually services brands) result in a long-term relationship, where once
consumers have bought the brand, they do not need to review their purchase
decision. Consumers are forced to review their decisions to buy Kit-Kats
whenever they become hungry, while with a bank’s current account, they are
not forced to review their decisions each time they undertake financial
transactions. This has implications for the classic attitude-behaviour link.
For product brands, e.g. Kit-Kat, changing the chocolate thickness coating
could affect someone’s attitude, leading to a change in purchasing behaviour.
By contrast, because changing banks involves effort, a worsening bank
service may unfavourably alter consumers’ attitudes, but not purchasing
behaviour. While there is a cause and effect linkage between attitude and
behaviour in product brands, this might be less so in services brands.
Product Environment
Brand's central idea
Communication Staff Behaviour
Figure 3. Manifestation of Brand’s Central Idea
(after Wolff Olins 1995)
12. 656 Leslie de Chernatony and Susan Segal-Horn
Another perspective, shown in figure 3, emerged from Wolff Olin’s (1995)
model whereby a brand’s central idea is manifest through four media;
product (dominates for BMW), environment (dominant for Harrods), staff
behaviour (dominant for the police) and communication (creative
advertising). This suggests product-services differences are less important
than which media dominates. To demonstrate this, Design Consultant 1
spoke about the way some global management consultants are stressing
communication as the basis of a consistent services brand. Yet client
satisfaction depends on the consultant they work with, which implies staff
behaviour as the more relevant medium.
An advertising agency saw brands as a blending of product and services
elements, questioning the dichotomy (cf. Levitt 1981). They define a brand as
“an organising principle which is transmitted out to the public and this determines
how a company organises itself and the services it provides” (cf. Free 1999). Their
philosophy is based on two types of brands – conviction and convention
brands. Conviction brands are based on “you can’t expect people to tell you
what your business is capable of or what the future will be”. Therefore, they strive
to envision new futures and make brave leaps with branding ideas. By
contrast, convention brands are incrementally pushed forward, based on
short term consumer desires (cf. Hamel and Prahalad 1994). The agency’s
philosophy encourages managers to back novel ideas, bravely challenging
existing practices. Talking about product vs services brands does not
encourage bold creative brand developments. A good example of a
conviction brand is the Orange mobile telephone, which challenged the
existing brands through the novel brand vision of “A wirefree future in
which you can call people, not places and where everyone will benefit from
technology”. At the time this was particularly poignant since competitors
were confusing people about technology. (Valance 1997).
Two brand consultants had conceptualisations that related to what both
referred to as the brand’s “centre of gravity”. Talking about product vs
services brands did not give any implications about how to develop a brand,
while the idea of the brand having a centre of gravity leads to ideas about
brand development.
A brand’s centre of gravity is “the tangible symbol, the icon of the brand”
(Brand Consultant 2): for the Automobile Association, the UK roadside
recovery service, it’s the yellow roadside vans and for KFC, the global fast
food chain, it’s the portrait of Colonel Sanders. Services brand building
necessitates understanding consumers’ interactions with the brand,
identifying from their perspectives the benefits from the services
relationship, building a service delivery system to satisfy these benefits, then
projecting them through a visible manifestation.
Brand Consultant 1 demonstrated “where is the brand’s centre of gravity?”
13. Building on Services’ Characteristics 657
with a three component brand model triangle shown in figure 4. For him, a
brand represents a proposition plus a personality. The brand can be
characterised by “its centre of gravity that sits somewhere within this framework”.
Thus American Express is more about how the cardholder feels, and this
originally emanated from the exclusivity of the card.
Who's it from Personality
What I get What I feel Proposition
Figure 4. The Brand Proposition – Personality Triangle
A final categorisation related to brands as promises (cf. Ward, Light and
Goldstine 1999; Ambler and Styles 1996), and brand management as promise
management. Four consultants explicitly, and one implicitly, mentioned this.
Market Research Consultant 1 conceived brands as the summation of
promised claims, “that which is fed to them by the advertisers” plus experiences
(cf. narrowing the services brand promise gap (Zeithaml and Bitner 1996)).
She considered “Tesco is successful because they made pledges about customer
service and delivered these, while Sainsbury only advertised them”. Design
Consultant 5 saw “a service brand is more to do with the description of a promise as
opposed to the product brand which is more of the actual item that resides in your
hand”.
Several emphasised “what is so difficult about services brands is delivering that
promise is really complicated”. Advertising Consultant 9 conceptualised a
services brand as the sum of a tangible component, “the seats, food, leg room”
in an aircraft plus an intangible component, “all the personal interactions along
the way from the check in” (cf. Levitt 1981) and the integrating system enabling
communication between employees, thereby facilitating all of them
consistently delivering the promise, as displayed in figure 5. Both product
and services brands integrate these components, but services brands could be
differentiated from product brands by the effectiveness of integrating
systems.
Advertising Consultant 3 related unfulfilled services promises to a
branding iceberg. As shown in figure 6, he pictured brands as icebergs, the
value adding process of which are either below the water, invisible to
14. 658 Leslie de Chernatony and Susan Segal-Horn
consumers (product brands) or above the water and highly visible (services
brands). The problem is “services firms have grown over time therefore the
systems are not what you’d design now”. The result is “systems are not all
aligned” and better systems and integration are needed
Integrating
systems
Services Brand
Tangibles Intangibles
Figure 5. Integrating the 3 Components of a Services Brand
Value
adding
systems
Value
adding
systems
Figure 6. The Product and Services Branding Icebergs
Several inferences can be drawn about successful services brands from these
consultants’ comments. Both product brands (Fournier 1998), and services
brands need well managed relationships. Unfortunately some services
organisations are complacent in their relationship management, incorrectly
15. Building on Services’ Characteristics 659
thinking that as consumers do not review their brand choice decisions, they
are satisfied. Being reliant on high exit barriers is not a sustainable services
branding strategy since some competitors can absorb the short term costs
helping consumers switch brands, knowing that offering better service
should lead to longer term profitability. Successful services brands are not
disadvantaged by their intangible characteristic. They have the opportunity
of conveying their benefits through four media and by devising suitable
symbols strongly associated with the brand’s benefits, an integrated
communications strategy can contribute to success. Successful services
brands reflect a firm’s principles and have a clear vision about a long term
future they wish to bring about. Successful services brands do not just raise
expectations through advertising, but also restructure their value delivery
processes using up to date systems that integrate all staff and facilitate a
greater likelihood of promises being met.
Classical and New Characteristics of Services Brands
When talking about the unique characteristics of services brands as a
springboard for implications about developing successful services brands,
virtually all consultants drew on the classical characteristics earlier reviewed
(e.g. Lovelock et al. 1999; Rust et al. 1996). The two classical themes most
discussed were the intangibility and heterogeneous quality characteristics.
However, another category of relationship characteristics also emerged,
leading to a new insight about services brands as a social process. Others
have recently indicated the importance of social processes (Dall’Olmo Riley
and de Chernatony 2000; Gummesson 1999). Comments, then inferences,
from these three characteristics will be considered.
Intangibility Characteristics
Seventeen consultants spoke about services brands being different from
product brands due to their intangibility, e.g. “There is a lack of physical reality
about them” (Advertising Consultant 6). Simply saying that services brands
are intangible achieves little, as this is widely known. Brand Consultant 2
summarised, “you can say they are abstract and that’s naive”. The challenge
consultants have faced is defining the services brand’s values, then finding
ways to represent these, for example through symbols.
One way to overcome this problem is to “create a picture of what the brand
stands for” (Advertising Consultant 5). This requires effective communication
and “a centre of gravity around which a relationship can take place”. For example,
the Goldfish credit card represented a major innovation in financial services.
Through the use of bold colours and using a domestic pet to reinforce home
essentials, Goldfish created a bright, friendly picture to brighten the usual
dullness of financial services branding.
16. 660 Leslie de Chernatony and Susan Segal-Horn
Communicating brand benefits is not just a case of “differentiating on the basis
of function or feature, but also on image and attitude of mind” (Brand Consultant
5). This is more of a challenge for services brands which depend both on
advertising, to communicate their values, and staff to represent the corporate
persona, enacting the values in their interactions with consumers, thereby
reinforcing the brand values at every point of contact.
Many successful brands circumvent the intangibility problem through
physical evidence (Zeithaml and Bitner 1996). This is difficult, since if for
example the brand promise is happiness, while some communicate it
through “smile programmes” (Gummesson 1999), this emotional labour
(Hochschild 1983) takes its toll on employees. Careful recruitment, regular
training and providing coping strategies (e.g. frequent breaks) support
communication via the physical evidence of staff.
As Western economies become experience economies (Pine and Gilmore
1998), the problem of intangibility may be surmounted since consumers can
“experience the service and so develop their views of the brand values and brand
qualities from the people delivering them” (Brand Consultant 3). This introduces
the problem of variable quality, due to differences between staff, as will
shortly be addressed. Thus there needs to be a shift from focusing on the
promise, to the process by which consumers will experience the promise,
especially when “the outcomes are quite often very intangible until the final
moment of delivery, which can be many years after a purchase” (Market Research
Consultant 2). Indeed some service brands, e.g. pensions and insurance,
cannot be evaluated until long into the future. Relationship marketing
provides one way of meeting this challenge, as will be discussed later,
through regular contact with consumers and building trust in the brand’s
ability to deliver its promise (Gummesson 1999).
Inferences may therefore be drawn about developing successful services
brands. Successful brands overcome the intangibility characteristic through
several strategies. Once the brand’s values are defined these can be linked to
a symbol, or logo, to create a picture around which knowledgeable and
committed staff can build relationships with consumers. Through
authentically delivering a brand’s values, a positive image should result in
consumers’ minds. Consumers’ recall of the services brand’s benefits should
be aided not only by cues from inanimate physical evidence, e.g. uniforms,
but also by employees’ behaviour.
Heterogeneity of Quality
Virtually everyone made reference to internal consistency issues. This is
because “You’re dependent on people…. and it takes only one person to have a bad
day for the entire brand delivery and experience to be fractured” (Marketing
Consultant 3). However, “not all tend to be inconsistent” (Advertising
17. Building on Services’ Characteristics 661
Consultant 6) and “McDonald’s have made it a key part of their whole offering to
have consistency” (Advertising Consultant 9). None spoke in Levitt’s (1976)
mechanistic terms about control systems to industrialise service delivery.
Instead they recognised the need to blueprint the service delivery process,
having a flowchart of both activities and interactions (Shostack 1987), to
understand and co-ordinate activities. As Marketing Consultant 4 noted,
“you’ve got to concentrate on the end to end customer experience, from the moment
they become aware of something”, and then “you have to co-ordinate different
departments and often large numbers of people working in different areas and get
them to behave in a way that’s consistent” (Advertising Consultant 3), in
addition to having “systems that support those people” (Advertising Consultant
9).
Several ways were suggested for encouraging consistent behaviour.
Thomson et al. (1999) argue that consistent staff behaviour depends on the
extent to which they understand and are willing to enact their brand’s
values. Experts’ comments reinforced this. For example, “it requires the
person the customer is talking to, to understand the promise and what the promise
means to the customer, and then they need to be trained to deliver the promise”
(Advertising Consultant 3). The literature indicated that gaining staff
commitment depends on the organisational culture (Schneider 1980), as well
as ensuring employee satisfaction (Heskett 1987). As Design Consultant 1
observed “it’s all about ……. attitude in terms of delivering what they have to
sell”. Adopting a more humanistic approach to internally managing the
brand was seen as important since “if people are nice and do a good enough job,
you will forgive an awful lot of other imperfections” (Advertising Consultant 9)
and “individual staff’s belief in what they are trying to achieve is the most important
difference, not the service delivery mechanisms” (Design Consultant 2).
Thus while experts recognised that “a service brand is offered by a person in a
particular place, at a particular time and is surrounded by factors that aren’t under
the control of the organisation” (Brand Consultant 1), there is a need for both
systems development and staff development, focusing on appropriate
cultural behaviours (cf. Kotter and Heskett 1992). This echoes Grönroos’
(1990) argument that service quality is dependent on what customers receive
and how they receive it, and the consultant’s views “it’s a balance
between…what the technology is delivering to you and how the person is delivering
it” (Brand Consultant 1). Involving staff much more in the brand, as First
Direct had done (Piercy 1999), and enabling them to recognise the numerous
“points of contact customers have” (Brand Consultant 2), encourage more
consistent quality.
We draw several inferences about successful services brands from these
comments. Consistency in services brands comes from well designed service
delivery processes that co-ordinate a total service experience across all points
18. 662 Leslie de Chernatony and Susan Segal-Horn
of contact, combined with social processes within a supportive organisational
culture. Internal communication is important in enabling staff to understand
the brand’s promise, and continual training should help them consistently
deliver the brand. Careful recruitment and attention to engendering an
appropriate culture can encourage the commitment of staff to the brand,
satisfaction in employees’ daily tasks and, as a result, a genuine behavioural
style which continually reflects the brand’s desired values.
Relationship Issues
There have been numerous changes in the services sector as a result of
deregulation and technology (e.g. Zeithaml and Bitner 1996), notably in
financial services (Taylor 1999). The move to more branded services and a
shift away from intermediaries to direct selling has led to consumer
uncertainty as they are not “used to using brands to make decisions” (Brand
Consultant 5). Not only are consumers “under educated and unconfident
purchasers of branded services” (Brand Consultant 5), but “there’s so much choice
these days and people don’t have the time to pursue the whole fixture” (Design
Consultant 1). As a result consumers “are looking for brands they recognise and
trust” (Design Consultant 1) and firms need to “concentrate much more on
relationships with consumers” (Marketing Consultant 2), (cf. Parasuraman et al.
1994), since a respectful relationship minimises consumers’ needs to
undertake information search into competing brands.
Services organisations have some way to go for their brands to be effective
relationship builders since “there is a much greater degree of inertia with services
brands” (Brand Consultant 4) because firms have “created a greater hurdle for
brand users to switch. That’s true for brands in financial services” (Brand
Consultant 2). While consumers expect to have a greater dialogue with
service providers, the challenge is to “accommodate me as an individual, without
making me feel I’m being mass processed in what is a mass market brand” (Market
Research Consultant 2). This challenge was described by the management
journalist as shifting from a “remote manipulations market type of model to a
sense and respond model of marketing”.
One response is, as Advertising Consultant 7 suggested, to regard
consumers as active co-producers of services brands (cf. Norman and
Ramirez 1994). Integrating consumers into the branding process necessitates
educating consumers, rewarding their contributions and managing the
customer mix (Zeithaml and Bitner 1996). Several saw the attractions of
nurturing consumers’ relationships with brands being that consumers can
tailor the brands to their needs making them “very stretchable” (Design
Consultant 3). Therein lies the positioning challenge, as the service brand
must have a clear positioning, yet because of consumers’ involvement, the
functional benefits might vary between individuals. Services brand
19. Building on Services’ Characteristics 663
positioning may focus more on the way the relationship could help
consumers achieve functional satisfaction.
The inferences from these comments are that successful services brands
build relationships between their brands and consumers based on greater
consumer dialogue through consumer-staff interactions and take more care
over integrating consumers into their brand delivery processes. Services
brands are more likely to succeed if organisations work with staff to build
consumers’ trust through genuine, rather than superficially enacted,
relationships. As a consequence of high exit barriers, managers of successful
brands monitor their services brands not through loyalty, but through the
quality of consumer-brand relationships. Effective use of databases
facilitates tailoring of the brand’s relationship with consumers, within the
guidelines of the brand’s values.
Discussion and Managerial Implications
While there is a notable literature about the product-services dichotomy, we
need to move beyond this when developing services brands. Consultants
have capitalised on knowledge of services characteristics to devise
innovative ideas for building and sustaining services brands. The brief
services branding literature and consultants’ comments indicate that while
the concept of the brand is common between product and services sectors,
the execution of the services brand’s strategy is different. The same external
orientation is common between the two sectors, identifying market
opportunities then developing and supporting suitable brand positionings
with unique personalities. However, in addition, an internal perspective is
needed for services brands. This entails recruiting employees whose values
will support the brand, enabling them to understand the brand promise,
training them to deliver the promise, engendering a culture to reinforce a
style of behaviour congruent with the brand promise and encouraging a
consistent relationship with consumers through staff who are committed to
delivering the brand promise. In services branding, the brand has to be
accepted as much inside the organisation as it is outside the organisation.
Trying to find ways of overcoming the intangible characteristic is but one
issue, however services brands appear to thrive because of an emphasis on
internal consistency and management of the services experience across all
points of interaction. Adopting the classical product brand model is
inappropriate for services since it does not have a balanced internal and
external orientation and it overlooks the importance of social processes.
Attempting to develop services brands solely on the basis of the
dichotomy provides only part of the services branding picture. Unlike
product branding, services branding involves interactions with a broader
20. 664 Leslie de Chernatony and Susan Segal-Horn
group of stakeholders, of which staff are an important part. More of the
value adding processes are visible to consumers of services brands and they
have more points of contact with services providers. As such, unlike product
branding, greater emphasis is needed to ensure a consistency of perceptions
about the services brands’ functional and emotional values across all points
of contact. The brand’s values are perceived not just from the advertising
claims and functional performance, but also by the way consumers and staff
interact.
A variety of categorisation themes were unearthed which provide an
inspiration for brand strategy. Some agencies had spent time refining their
ideas and their services brand consulting was couched within their brand
conceptualisations.
While the majority of experts referred to the traditionally cited differences
between products and services, i.e. intangibility and heterogeneous quality,
they suggested ways of circumventing these problems, and also indicated an
opportunity for growing services brands as relationship builders.
The intangibility problem necessitates managers working harder to
describe their services brand’s benefits. The visual power of the “centre of
gravity” offers the opportunity for a services brand’s values to be conveyed
through an icon, for example the insurance company Direct Line’s use of the
red telephone in all its advertisements. The experience-based economy (Pine
and Gilmore 1998) emphasises helping consumers both to visualise and
anticipate the brand experience. Brands such as the Rainforest Café
encourage consumers to use all their sensations to experience the brand.
There is an opportunity to communicate not just the benefits but also the
processes consumers will be involved in when they co-produce services
brands.
From a systems perspective there was encouragement for using service
blueprints to understand and improve the service delivery process, along
with co-ordination and support systems enabling staff to understand the
brand promise and communicate with each other. Managers need to re-
evaluate operational procedures to ensure regular training and support
services keep pace with changing consumer needs. From an organisational
perspective there is a need for a culture which is aligned with the services
brand’s desired values and which encourages staff to behave in the desired
way. Managers should also consider ways of increasing employee
satisfaction in their brand delivery role (e.g. celebration of good behaviour).
Strong services brands (e.g. Disney, McDonalds) have long enacted such
internal procedures.
Managers should consider opportunities from their organisational culture
to enable staff to act in a manner which strengthens consumers’ relationships
with the services brand. Consumers are likely to welcome efforts to build
21. Building on Services’ Characteristics 665
stronger ties and have greater trust in brands. This will require greater
dialogue and more responsiveness to changing consumer needs.
Conclusions
Little has been published about services branding. We sought to advance
knowledge by going beyond the product-services dichotomy. While this was
a useful starting point, alternative categorisations exist for services brands
strategy.
Classical branding models were developed in the product sector (e.g.
Aaker 1996). They emphasise developing, then communicating, a cluster of
functional and emotional values to consumers. We believe it is inappropriate
to directly employ the classical models in the services sector. Staff play an
important role in services branding, influencing brand quality and brand
values through the interactions they have with consumers. In services
branding the external (market) bias of the classical branding model needs
rebalancing with an internal (organisational) perspective.
Prior to services brands being promoted to consumers, consideration must
be given to internal issues. Staff need to understand their brand’s unique
benefits, be trained to play their part delivering this, and be backed by
systems to facilitate communication between them. Managers need to
encourage a culture which is aligned with their brand’s values, encouraging
behaviour which supports the brand. Once these internal issues are
addressed, it is then appropriate to promote externally the services brand’s
benefits, focusing on the management of the total services branding
experience.
There are opportunities for increasing services brands’ equity through
placing more emphasis on employees’ roles in building consumers’
relationships with the brand. Consumers have difficulty understanding the
service promise, but can evaluate a relationship, which ultimately should
result in trust and rapid decision making. Services brands can differentiate
themselves through the relationships they offer and responsiveness to
changing needs.
Future research is needed to evaluate whether successful services brands
are being managed in a way consistent with the ideas we have put forward.
We plan to undertake further research to see whether high performing
services brands can be discriminated from low performing ones according to
the insights advanced in this paper.
Acknowledgements
We would like to acknowledge with thanks the help of Sajid Khan who
assisted with interviewing
22. 666 Leslie de Chernatony and Susan Segal-Horn
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About the Authors
Leslie de Chernatony is Professor of Brand Marketing and Director of the
Centre for Research in Brand Marketing at The Birmingham University
Business School. With a doctorate in brand management he has a substantial
number of publications in American and European journals and is a regular
presenter at international conferences. He has several books on brand
marketing, the most recent of which is From Brand Vision to Brand Evaluation,
published by Butterworth-Heinemann. He was Visiting Professor at Madrid
Business School and currently Visiting Professor at Thammasat University,
Bangkok. A Fellow of the Chartered Institute of Marketing he acts as an
international consultant to organisations seeking more effective brand
strategies.
Susan Segal-Horn is Professor of International Strategy at Canterbury
Business School (CBS), University of Kent. Before joining CBS in 1999, she
was Director of the International Strategy Research Unit and also Head of the
Centre for Strategy and Policy at the Open University Business School.
Susan had previously worked for several years in the Strategy Group at
Cranfield School of Management. Susan has published three books and
more than 60 academic articles and professional papers in the fields of
strategic management and international strategy. Her articles have appeared
in such journals as the Journal of Marketing Management, the Journal of Global
Marketing, the European Management Journal and Strategy and Leadership.
