Monday 10 July 2006
Professor Roland T Rust believes the central elements of brand management - developed for goods-centred economies - must be updated and rethought for the new service-centred economy.
Rust was one of the headline speakers at the recent Frontiers in Service conference hosted by University of Queensland Business School.
He said, "Brands exist to serve customers, not the other way around."
"The key is to manage the portfolio of bands to maximise the customer relationship, rather than managing the portfolio of brands to maximise a brand's profitability."
"Thus the fundamental metric that should guide brand management is the firm's customer equity, the sum of the customer lifetime values of the firm's current and future customers."
"Brand equity only exists one customer at a time - no brand has good brand equity inherent in itself."
Rust said that a brand could have good brand equity among some customers or customer segments but could simultaneously have poor brand equity for others.
"As the customer base and the media that serve it fragment, brands increasingly need to become narrower." Professor Rust said.
"This is an irreversible trend, because the forces leading to fragmentation are driven by the advance of technology."
Rust holds the David Bruce Smith Chair in Marketing at the Robert H. Smith School of Business at the University of Maryland - where is also Chair of the Marketing Department and Executive Director of the Centre for Excellence in Service.
Media enquiries:
Cathy Stacey
Marketing Development Manager
Phone (07) 3365 6179
Mobile 0434 074 372
Fiona Sutton
Mobile 0423 637 699
Email media@business.uq.edu.au
Professor Janet McColl-Kennedy
Phone (07) 3365 6179
Mobile 0434 074 372
Email c.stacey@business.uq.edu.au
