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.
Professor Rust, of the Center for Excellence in Service, University of Maryland, is one of the headline speakers at this weekend’s Frontiers in Service conference hosted by The University of Queensland Business School.
“Brands exist to serve customers, not the other way around," Professor Rust said.
“The key is to manage the portfolio of brands 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.”
Professor 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.”
Professor Rust will deliver his paper at 8.30am on Sunday at The University of Queensland’s St Lucia campus.
He will be available for phone interviews between 10 and 10.30am on Sunday, July 2.
For more information contact Cathy Stacey on (07) 3365 6179 or 0434 074 374 or Professor Janet McColl-Kennedy on 0417 074 010.
