Branding for Services Firms

Although the principles for branding of goods and services are generally the same there occur some differences. These arise from the different natures of both categories. The main differences that influence branding policies are that services

  • often  have a changing level of quality,
  • often the consumer has to become actively involved in the consumption of a service ,
  • are hard to visualise.

When a brand in general gives the consumer more confidence in his choice this is even more important for services. Their quality and other features are more difficult to assess. Because of their intangibility and complexity it is harder for the customer to distinguish between the offers from the wide range of service companies operating in the market place.

The literature suggests to use the company’s name – a so called corporate brand – as the overall family brand for all the services offered. This is called  the “monolithic approach”.  For firms which offer an enormous array of services (e.g. consultants, banks) corporate names must be used to deliver more generalised benefits of quality, value and integrity.

Corporate brands are a crucial means to help make the service offering more tangible in consumer’s minds and can enhance consumers perceptions and trust in the range of services provided by the company.

One disadvantage of corporate brands – little opportunity for developing second or sub-brands for differentiated product lines– applies more to branded products. However t many companies have chosen an approach of “local autonomy but group-wide coherence” as a system whereby individual divisions and products are largely free-standing but mention is made in all literature and on all stationery and products that “company A is member of the XYZ group”.

It allows national member firms, to exploit the groups brand name and their own (brand) name at the same time. Many member firms that had joined the global firms have long traditions and a good reputation of their own. For them it is important to demonstrate their clients that these qualities are not lost, on the contrary – other qualities and services are added.

 Choosing a brand name

The decision for a brand name has to be taken carefully because it can have a long term influence on the success of the branded product or – in the case of a corporate brand – of the whole company.

 To pick out one issue of the process of developing a brand name, there is a big choice in the spectrum from descriptive to free-standing names which are often artificial words with no obvious relation to the good or service. Free standing or arbitrary names are more suitable if they are to stand for a variety of services since there is no initial associations with this name. In addition they are the potentially strongest form of trademark in legal terms.

As for professional services firms  a common theme in the brand names is the use of the companies founder’s names. For instance the name KPMG stands for Klynveld, Peat, Marwick and Mitchell, Goerdeler. In the process of the merger between Price Waterhouse and Coopers & Lybrand they had to develop a new name for the new company that would exploited the reputation and heritage from both old names. This was important for the relationship with the existing customers as well as for the relationship with all employees. The result was the name PricewaterhouseCoopers. This corporate name is formed out of three names of founders of companies where the new company originates from (Price, Waterhouse, Coopers). Both names are completely free-standing. That’s why they properly address the issues of suitability for different media, different markets and cultures and different products as well as the issue of imitation and legal protection.Marketing a service brand

Some writers suggest that marketing strategies for services focus on three more P’s to the marketing mix, which stand for Process, Physical evidence and People. The same principles would apply to the branding of services.

Process

Process is an element of service that sees the customer experiencing an organisation’s offering. It’s best viewed as something that your customer participates in at different points in time.

Physical evidence

The element of physical evidence is about the environment in which the service is offered and consumed, it is about the customers “feelings”. As for branding services, the physical evidence is closely related to the personality of the brand, which can be described as an emotional bond to the customer that grows out of the perceived characteristics of the brand. To give the service a differentiation advantage it is important to create a distinguishable atmosphere that the customer can relate to the service provider. This can be achieved by the use of corporate brand signs, corporate colours and several other themes that are common for all outlets, all employees everywhere the company presents itself to the public.

People

People are often important as the providers of the service (although technology does replace people in more and more serice situations). The careful selection and training of staff firstly assures a higher level of quality of the service, that is depicted by the brand. It is up to the people to give the processes more reliability and thus to assure a higher homogeneity between the quality of the service and the personality and message of the brand. Furthermore people have contact with the customer. They have to be aware of the brands objectives so that they can “live them” and communicate them to the customer. It is not enough to communicate the message of the brand externally to the customer; the first step has to be internal communication.

For general reference, I have long maintained that have said that these extra 3 P’s are already adequately covered in the original 4 P’s and the making a model bigger does not help its usefulness.  However they can be considered within the traditional 4 P’s for added emphasis.

Other have suggested some additional R’s for a Services Marketing Mix

Reach, Recognition, and Reputation

Reach the right audience by picking the right targets. Only the largest companies where broad based awareness and recognition are important to front load a very large sales funnel need to communicate to the entire market. You don’t have to influence such a large universe to be successful, so don’t.

Target your list. Many service business leaders have an idea of what the ideal client or prospect looks like. Define your target market in terms of company size, location, industry, title, and other key factors that pertain to your services. Then find out who those companies are.

A brand provides the basis of Recognition

Enhance your reputation by demonstrating your value to clients.

If you want impact (and qualified leads) that can actually grow your business, focus on a specific target, make a specific offer, and rely on the value of the offer to establish your brand and reputation.

Reality and Relationships

Sales cycles for services are often long. It often takes a number of months (or years) to nurture a prospect into a client. This calls for an extremely deep relationship that can only be established through direct, integrated, and sustained contact. If each contact is meaningful and delivers value in the form of a best practice study, white paper, seminar invite, or the like, you create an impression and gain awareness with that prospect.

That impression, if reinforced consistently over time, develops not just recognition but reputation in the minds of your prospects.

Three elements of the market

Here the principles of internal marketing play an important role. Staff is seen as the first customer of the brand. Kotlers (1999) typology of marketing in service industries applies equally to the marketing of brands in service industries:

The theme here is that the customer not only receives the message from the companies external marketing activities, but also the message from the behaviour of the staff he has contact with. The impression the customer gets from the service, from the company and thus from the personality of the corporate brand is also influenced by the friendliness and responsiveness of staff, their perceived qualification and how the staff “lives” the philosophy of the corporate brand.

A fourth element

I suggest that a fourth element also needs to be included – Facilitators and supporters of the product/brand.  These are external agents such as retailers and installers which the brand relies on.

As for branding service firms, physical evidence is more than just to having a visible corporate identity. It is about bringing a message across. In this industry the message of the brand has to establish the emotional bond to the customer which is one of the few ways for differentiation.

Some clients may ask how brand building sits alongside the traditional virtues of a professional partnership – skilled individuals with independent minds able to solve problems on a case by case basis. The real challenge is turning that into a brand.

Processes are very important in many services industries since in most cases the customer is directly involved in the processes. Aspects that especially apply to the legal, finance and consulting industries are extremely high quality, confidentiality, timing/availability, consistency and the avoidance of the abuse of insider knowledge.

The internal processes that assure these characteristics are less important for the customer. For him or her it is important that these characteristics are met. Again a brand can provide more confidence in the choice of a service provider. It allows a prospective client to identify a provider with a good reputation for high quality processes and results. As with most other services the quality of the auditing or consulting processes cannot be tested in advance. Moreover, you can change your hairdresser if you are not satisfied but it is much harder to change your auditor since public normally perceives this as some sort of sign for alert.

On the other hand, even if necessary, there are dangers in relating a brand to closely to the quality of processes. Poor quality in only one single case can affect the whole brand. Many of the professional services firms have faced the problem that one of their major clients went into bankruptcy or was accused for some illegal activity. In such situations the media often ask about the quality of the auditing processes.

Marketing and Services

Customers of service organisations will be influenced by a range of factors in their decisions to purchase or use a specific product.  One of these factors is the role played by physical (tangible) aspects and evidence.  Tangibility is not only necessary in delivering a product but physical evidence can also assist in creating the image, the environment and the atmosphere in which a product is bought or performed and can help shape customer perceptions.Internal marketing

In most marketing activities the employee plays a central role in attracting, building, and maintaining relationships with customers.  This aspect of services marketing has led to the concept of internal marketing.

Providers must interact effectively with customers to create and/or maintain value during service encounters. Effective interaction, in turn, depends on the skills of frontline service employees and on the service production and support processes backing these employees

To build a world-class service brand there are three things you will need to define or create:

  • The brand’s personality.
  • The relationship the brand has with the target segment.
  • Visual icons, symbols or other representations of the brand such as the logo or a character.

The three steps to building a brand are:

  • Create a character or personality for the company, the product (goods and services).  Just as you would for a real person, based on that brand-person’s reputation, attitudes and behavior.
  • Build a relationship with your target market based on that personality. Do this over time, using integrated marketing communications, including the way employees are trained to interact with customers.

Reinforce the relationship and trigger recognition with consistent visual symbols. These symbols can include everything from a colour scheme and logo to an imaginary character, or a person

When an organisation chooses to brand its products, it may opt for one or more of the following branding policies: individual, overall family, line family, and brand-extension branding.

Individual branding is a policy of naming each product differently.  A major advantage of individual branding is that if an organisation introduces a poor product, the negative images associated with it do not contaminate the organisations other value offers.  An individual branding policy may also facilitate market segmentation when a firm wishes to enter many segments of the same market.  Separate, unrelated names can be used, and each brand can be aimed at a specific segment.

Multibranding is a policy of using many brands for different offerings.

In family branding, all of a firm’s products are branded with the same name or at least part of the name.  Unlike individual branding, overall family branding means that the promotion of one item with the family brand promotes the firm’s other products.

Sometimes an organisation uses family branding only for products within a single line.  This policy is called line family branding.  .

Brand-extension branding occurs when a firm uses one of its existing brand names as part of a brand for an improved or new product that is usually in the same product category as the existing brand. There is one major difference between line family branding and brand-extension branding.  With line family branding, all products in the line carry the same name, but with brand-extension branding, this is not the case.  Line family branding and brand-extension branding are both popular in service product branding

Brand repositioning – A brand offers a promise to a particular target segment.  Competitive activity or the search for additional markets may lead to brand repositioning Brand repositioning involves changing the brand’s image to the new market(s) so that it is more appealing to them.   It is important not to lose or confuse the positioning of the brand with current market segments.

Licensing – Some organisations will license their well established brand names to other organisations for a fee.  In this way the acquiring firm can benefit from the existing strong brand equity

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