Marketing Communications

52 CHAPTER 2 BRANDING

protect bastion brands, fl anker, fi ghter or prestige brands can be introduced. A fl anker brand

follows a similar price–profi t ratio as the bastion brand, is also characterised by a high

psycho-social meaning and perceived performance level, but usually appeals to a diff erent,

smaller market segment (niche). Fighter brands are sold at a lower price, situated between the

price of the bastion and discount brands. Th eir quality perception is usually lower than that

of the bastion and fl anker brands. Prestige brands are high-quality, luxury brands targeted at

a smaller segment, looking for status and high psycho-social meaning.^42

Procter & Gamble’s shampoo bastion brand is Pantène, while Head & Shoulders can be

considered as a fl anker brand. Philip Morris introduced Basic as a fi ghter brand to protect

Marlboro, just as Procter & Gamble launched Bonux to protect Dash, and the Volkswagen

Group acquired Seat and Skoda to safeguard Volkswagen. Finally, Toyota and Nissan have

Lexus and Infi nity as prestige brands.^43

Brand equity

In the previous sections it has been argued that brands are valuable assets for marketing.

Brand equity is a concept that is used to indicate the value of a brand. It is the value added

to a product by virtue of its brand name.^44 In fact, a distinction should be made between

consumer brand equity a n d fi nancial brand equity.^45 Th e latter refers to the fi nancial value of

the brand for the company, the former to the underlying customer- and marketing-related

components of brand equity. In practice, the concept of brand equity is used to describe

both. Economically speaking, the value of a brand is the sum of all discounted future income

streams attributable to the brand.

Financial brand equity

When looking at the balance sheet of companies marketing branded products, one generally

fi nds only buildings, machines and inventories there. Seldom is the goodwill built up in well-

known brands shown. However, whenever a company is involved in mergers or acquisitions,

the fi nancial value of the brand portfolio becomes of great importance. Some say that the

brand portfolio is the most valuable asset of a company. John Stuart, former president of

Figure 2.3 A brand portfolio model

Source : Riezebos 1995, cited in Riezebos 2003.

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