Farquhar (1989) suggests a relationshipbetween high brand equity and market powerasserting that:
The competitive advantage of firms that havebrands with high equity includes theopportunity for successful extensions,resilience against competitors' promotionalpressures, and creation of barriers tocompetitive entry.
This relationship is summarised in Figure 2.Figure 2 indicates that there can be morethan one outcome determined by brandstrength apart from brand value. It should benoted that it is argued by Wood (1999) thatbrand value measurements could be used asan indicator of market power.Achieving a high degree of brand strengthmay be considered an important objective formanagers of brands. If we accept that therelationships highlighted in Figures 1 and 2are something that we should be aiming for,then it is logical to focus our attention onoptimising brand description. This requiresa rich understanding of the brand constructitself. Yet, despite an abundance of literature,the definitive brand construct has yet to beproduced. Subsequent discussion exploresthe brand construct itself, and highlights thespecific relationship between brands andadded value. This relationship is consideredto be key to the variety of approaches tobrand definition within marketing, and iscurrently an area of incompatibility betweenmarketing and accounting.
The brand construct
The different approaches to defining thebrand construct partly stem from differingphilosophies (such as product-plus andholistic branding outlined below) andstakeholder perspective, i.e. a brand may bedefined from the consumers' perspectiveand/or from the brand owner's perspective.In addition, brands are sometimes defined interms of their purpose, and sometimesdescribed by their characteristics. Thefollowing examines the diverse approaches tobrand definition. From this diversity anintegrated definition is drawn.The American Marketing Association(1960) proposed the following company-oriented definition of a brand as:
A name, term, sign, symbol, or design, or acombination of them, intended to identify thegoods or services of one seller or group of sellers and to differentiate them from those of competitors.
This definition has been criticised for beingtoo product-oriented, with emphasis on visualfeatures as differentiating mechanisms(Arnold, 1992; Crainer, 1995). Despite thesecriticisms, the definition has endured tocontemporary literature, albeit in modifiedform. Watkins (1986), Aaker (1991), Stanton
. (1991), Doyle (1994) and Kotler
(1996)adopt this definition. Dibb
(1997) use theBennett (1988) variant of the definition whichis:
A brand is a name, term, design, symbol orany other feature that identifies one seller'sgood or service as distinct from those of othersellers.
The key change to the original definition arethe words ``any other feature'' as this allowsfor intangibles, such as image, to be the pointof differentiation. The particular value of thisdefinition is that it focuses on a fundamentalbrand purpose, which is differentiation. Itshould not be forgotten that brands operate ina market environment where differentiationis crucially important. Even wheremonopolies exist, companies may choose toposition their brand(s) with a view to futurecompetition. The other key feature of thisdefinition is that it takes the corporateperspective rather than emphasisingconsumer benefits.Ambler (1992) takes a consumer-orientedapproach in defining a brand as:
the promise of the bundles of attributes thatsomeone buys and provide satisfaction
F F F
Theattributes that make up a brand may be realor illusory, rational or emotional, tangible orinvisible.
These attributes emanate from all elementsof the marketing mix and all the brand'sproduct lines. The attributes of a brand arecreated using the marketing mix, and aresubject to interpretation by the consumer.They are highly subjective. Brand attributesare essentially what is created through branddescription (one interpretation of brandequity) mentioned previously.Many other brand definitions anddescriptions focus on the methods used toachieve differentiation and/or emphasise thebenefits the consumer derives frompurchasing brands. These include (
)definitions and descriptions that emphasisebrands as an image in the consumers' minds(Boulding, 1956; Martineau, 1959, Keller, 1993)brand personality (Alt and Griggs, 1988;Goodyear, 1993; Aaker, 1996), brands as valuesystems (Sheth
., 1991), and brands asadded value (Levitt, 1962, de Chernatony and
The relationship between brand equity andmarket power
Brands and brand equity: definition and management
Management Decision38/9  662±669