Brand Management: Research, theory and practice

34 Seven brand approaches

of the brand–consumer exchange imply? It implies that every time the primary goal
is to achieve a transaction, as opposed to a lasting relationship, the exchange is
hence analysed as an isolated event.
In the theoretical models there is little interaction between the brand and the
consumer. It is assumed that brand choice is based on a linear communication,
where the marketer sends off brand messages in the shape of a product, price, a
placement and promotions, and the consumer receives these messages and acts on
them (make the purchase) if they are right. That exchange is hence perceived to
consist of the mere transaction without interactivity; in fact very few or no
external, uncontrollable factors are included in the theoretical apparatus

Summary

The assumptions of the economic approach are based on neoclassical micro-
economics of how market forces allocate resources most efficiently through the
principle of the ‘invisible hand’ and classic marketing theory. The consumer is
assumed to be able to make rationally based brand consumption choices and to be
focused on utility maximization, which is why they will always choose whatever
brand delivers the best utility value compared with the price. The theoretical
apparatus is based on the basic ideas from transaction marketing, where it is
assumed that the exchange between brand and consumer consists of isolated
transactions rather than an ongoing relationship. The primary goal of brand
communication is hence to ensure that consumers are aware of the fine qualities
of the brand at the right time and place through linear communication from the
brand to the consumer.

Assumptions

Theory

Methods and data

Managerial implications

Figure 4.2Assumptions of the economic approach