The Marketing Advantages of Strong Brands

Abstract

Building strong brands has become a marketing priority for many organisations. The presumption is that building a strong brand yields a number of marketing advantages. In this paper, a comprehensive summary of empirical findings is provided from some of the major marketing journals that reveal how brand strength, operationalised in various ways, can create differential responses by consumers to various marketing activities - a well-accepted view of brand equity. Additionally, some underlying theoretical mechanisms on which these findings are based are identified and organised. Lastly, some current gaps in the literature are identified, and an agenda put forth for future research on the marketing advantages of strong brands.

Full text

minds of consumers — individuals or
organisations — as the source or
foundation of brand equity. For ex-
ample, one view of brand equity is ‘the
differential effect that brand knowledge
has on consumer response to marketing
activity’.
4,5
According to this view, a
brand is thought to have positive
equity to the extent that consumers
respond more favourably to marketing
activities when the brand is identified,
compared to when it is not. Differen-
tial response may be reflected in
differences in consumer perceptions,
preferences or behaviour, and may be
manifested in response to any type of
marketing activity for the brand.
Understanding how brand
INTRODUCTION
Brand equity has been defined in a
number of different ways for many
different purposes.
1–3
No matter how it
is used or measured, however, the
value of a brand — and thus its equity
— must ultimately be derived in the
marketplace from the words and ac-
tions of consumers. That is, consumers
decide with their purchases, based on
whatever factors they deem important,
which brands have more equity than
other brands. Thus, although the
details of the approaches to brand
equity may sometimes differ, they tend
to share a common core: all definitions
either implicitly or explicitly rely on
brand knowledge structures in the
䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003 421
Steve Hoeffler
Kenan-Flagler School of Business,
University of North Carolina,
Campus Box 3490, McColl
Building, Chapel Hill, NC 27599
3490, USA
Te l : ⫹1 919 962 4926
Fax: ⫹1 919 962 7186
E-mail: hoeffler@unc.edu
The marketing advantages of
strong brands
Received (in revised form): 20th January, 2003
STEVE HOEFFLER
is an assistant professor at the Kenan-Flagler School of Business, University of North Carolina. His areas of
expertise include: branding, consumer behaviour, decision making, and preference development. He was formerly
the marketing representative for NCR/AT&T and consultant to Procter & Gamble, IBM, and Fujitsu. Professor
Hoeffler received his PhD from Duke University (2000), his MBA from the University of California Davis (1994)
and his BSc from San Diego State University (1985).
KEVIN LANE KELLER
is the E.B. Osborn Professor of Marketing at the Amos Tuck School of Business at Dartmouth College, Hanover,
USA. His academic resume´ includes degrees from Cornell, Duke, and Carnegie-Mellon universities with
award-winning research and prior faculty positions at Berkeley, Stanford, and UNC. His textbook, Strategic Brand
Management, has been adopted at top business schools and leading firms around the world and has been
heralded as the ‘bible of branding’.
Abstract
Building strong brands has become a marketing priority for many organisations. The presumption is
that building a strong brand yields a number of marketing advantages. In this paper, a
comprehensive summary of empirical findings is provided from some of the major marketing
journals that reveal how brand strength, operationalised in various ways, can create differential
responses by consumers to various marketing activities — a well-accepted view of brand equity.
Additionally, some underlying theoretical mechanisms on which these findings are based are
identified and organised. Lastly, some current gaps in the literature are identified, and an agenda
put forth for future research on the marketing advantages of strong brands.

and observations made about the
prevalence of the marketing advantages
of strong brands, current gaps in the
marketing literature concerning the
formation and use of brand knowledge
are identified, and an agenda put forth
for future research.
CONSUMER BRAND KNOWLEDGE
The chief research objective is to
document the authors’current under-
standing of how brand knowledge
affects consumer response to marketing
activity. Accordingly, in this section, a
brief outline is given of some relevant
dimensions of brand knowledge and
the authors discuss the different ways
in which brand equity has been
operationalised or addressed in the
marketing literature.
In terms of brand knowledge, one
widely adopted conceptualisation in-
volves the associative network memory
model. According to this model, a
brand will have a node in memory
that may be associated with a variety
of other nodes. All types of brand
nodes may be linked to the brand
to make up its brand associations in
memory. Moreover, there are a num-
ber of dimensions by which these dif-
ferent kinds of associations may be
characterised.
For example, brand associations may
vary according to content and whether
they are related to the product or not.
Non-product associations may relate
to user or usage imagery, brand per-
sonality, and so on. Brand associations
mayalsovaryintheirlevelofabstrac-
tion, ranging from concrete and speci-
fic (for example, product attributes) to
more abstract and general (for example,
overall brand attitudes). Brand associa-
tions can vary in how strongly they are
knowledge structures are created and
how they influence consumer
behaviour is thus a research priority.
Along those lines, there has recently
been a call in the marketing literature
for more comprehensive approaches to
understanding the underlying
mechanisms associated with the
formation and consequences of brand
equity.
6
Related to this there been
doubts and questions expressed by
senior management in many
organisations about the value of
brand-building activities.
Accordingly, there are three pur-
poses to this paper. First, the different
dimensions of brand knowledge and
different forms of consumer responses
to marketing activities are briefly out-
lined. Secondly, some of the major
academic marketing journals in the
USA and elsewhere are surveyed to
catalogue empirical findings from prior
research that reveal how greater brand
knowledge can:
—lead to fundamental differences in
consumer behaviour
—produce differential responses to
specific marketing activities (ie re-
lated to product, extension, price,
communications and channels) by
consumers depending on the nature
of the brand involved.
To the authors’knowledge this is the
first attempt to catalogue some of the
underlying theoretical mechanisms that
havebeenshowntoleadtoadvantages
for strong brands. In addition, findings
are also identified that provide market-
ing advantages for lesser-known brands
and identify instances where differential
responses are not found for strong
brands. Thirdly, as a result of these
reviews, some conclusions are provided
422 䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003
HOEFFLER AND KELLER

asymmetric promotion effects revealed
differential responses to marketing ac-
tivity according to type of brand, but
these findings were a by-product of the
analysis and not its central thrust.
DIFFERENCES IN CONSUMER
BEHAVIOUR
In examining relevant past studies to
understand the marketing advantages of
strong brands, researchers have iden-
tified a number of different theoretical
mechanisms to explain why brands
for which consumers have greater
brand knowledge receive a differential
response. In this section, an attempt is
made to organise some of the main
proposed theoretical mechanisms into a
simple conceptual framework of how
brand knowledge is created and put to
use by consumers.
As an organising framework, a
modified form of the simple AIDA
hierarchy-of-effects model (Attention,
Interest, Desire and Action) was used.
This has been widely used to model
consumer behaviour in advertising
settings and elsewhere. First this paper
will focus on the attention and learn-
ing stage, ie the building of brand
knowledge structures. Next, this paper
will look at mechanisms associated
with the interpretation and evaluation
of marketing information or brand
alternatives, ie the use of brand
knowledge. Finally, this paper examines
the mechanisms that are thought to
impact the actual choice process, ie the
application of brand knowledge.
Attention and learning
Strong brands are thought to have a
memory encoding and storage ad-
vantage over unknown brands in
linked to the brand and its other as-
sociations, how unique or common
they are, how favourably consumers
regard them, and so on.
The customer-based brand equity
framework
7,8
is used as a means of
identifying the existence of marketing
advantages for strong brands. In that
framework, brand equity is defined in
terms of the differential response to
marketing activity that results from
the existence of strong, favourable and
unique brand associations. Researchers
studying the effects of different types of
brands, however, have used a number
of proxies for ‘strong’or ‘high equity’
brands. In general, high equity brands
have perhaps been most often concep-
tualised via familiarity (for example,
prior knowledge, ownership or ex-
posure to the brand) or through out-
come-oriented measures (for example,
market share leader, dominant brand or
high-quality brand). Low equity brands
have been operationalised as either the
polar opposites of high equity brands or
via fictitious brands.
Regardless of the exact means of
designating a brand as strong, this
paper uses the concept of ‘differential
response to marketing activity’as the
key selection criteria when deciding
which papers suggest an advantage for
strong brands. Thus, some papers
that are geared towards understanding
brand equity are not cited because they
do not reveal any clear differential
response according to the nature of the
brand involved. With some other
papers, it was necessary to infer brand
equity effects because although the
type of brand was not the main focus
of inquiry, it was still manipulated or
measured in some way and showed up
as significant in the analysis. For
example, many of the early papers on
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THE MARKETING ADVANTAGE S OF STRONG BRANDS

Selective attention
Strong brands may find the strength of
their brand affected at an involuntary
level by consumers automatically en-
coding frequency information (Hasher
and Zacks
17
)astheyareexposedto
brand names, symbols, slogans and
logos through various marketing ac-
tivities. Non-verbal information about
the brand such as symbols, slogans and
logos may be more potent or meaning-
ful than verbal cues.
18
Strong brands
can also benefitfromincreasedselec-
tive attention. Tellis
19
contends that
familiar brands are selectively given
more exposure, attention, comprehen-
sion and retention by consumers.
Similarly, Kent and Allen
20
propose that
consumers will selectively pay more
attention to advertising for well-known
brands.
In short, it appears that information
about strong brands is more easily
noticed and the frequency of advertis-
ing of strong brands may create
favourable associations even in the
absence of voluntary processing of the
brand information. In addition, con-
sumers may give more selective atten-
tion to strong brands.
Interpretation and evaluation
There is evidence for both direct
and indirect mechanisms operating to
create differences in how consumers
interpret and evaluate brands and
related marketing information.
Direct effects
Direct effects occur when brand-
related information is input directly
into the decision process. For instance,
one conceptual mechanism that is
moderated by differences in brand
building brand awareness and image.
Johnson and Russo
9
assert that con-
sumers familiar with a brand have
better encoding ability and bet-
ter-developed procedural knowledge.
Alba and Hutchinson
10
also provide
evidence consistent with the notion
that more elaborate memory structures
will facilitate the formation of linkages
of new associations. Kent and Allen
11
use information organisation models
and schema research as a basis for
inferring that consumers will develop a
greater number of stronger links for
familiar brands. Moreover, because
strong brands have better developed
consumer knowledge structures, there
is a greater likelihood that the links that
make up this knowledge will be
uniquely associated with the brand.
When consumers have less developed
knowledge structures, on the other
hand, associations may end up being
stored under the product category and
not the specific brand. In fact, Bowman
and Gatignon
12
contend that learning
decreases for brands that are late to
enter into a market, because they are
seen as having less novel features.
Consideration
Another advantage related to brand
strength is differential inclusion of
brands that are more accessible into
consumers’consideration sets. The
accessibility advantage for brands with
a greater number of associations in a
wide variety of contexts implies famil-
iar brands are more likely to be
in consumers’consideration sets.
13–15
More attractive brands also receive an
advantage when consumers begin their
search with well-known and regarded
brands that are seen as being more
likely to satisfy their needs.
16
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HOEFFLER AND KELLER

general, ambiguity in the decision-
making process should favour the
incumbent or stronger brand.
26
Hoch and Deighton
27
propose that
confirmation biases can lead to
favourable evaluations in the presence
of ambiguous information (for ex-
ample, as a result of advertising). When
evaluating ambiguous stimuli, the
primary determinant of evaluative
directionality is prior attitudes.
28
With
prior positive evaluations, cognitive
evaluations should be more receptive
and less critical
29
and richer for brands
with which people have more
experience in more contexts.
30
Finally,
consumers may use brand names as a
signal of the credibility of product
claims.
31
Thus, evaluation advantages —
through more elaboration —may help
strong brands to indirectly create even
stronger and more favourable associa-
tions.
Choice
Perhaps the most frequently cited
advantage for strong brands at the
choice stage is the notion of brand
recognition or familiarity as a choice
heuristic.
32–35
Essentially, when con-
sumers have limited prior knowledge
of a product category, brand name may
be the most accessible and diagnostic
cue available.
36
Dodds et al.
37
further
propose that brand name familiarity,
in conjunction with a high price
and availability in a store with a
quality image, may act as independent,
yet related, diagnostic cues for con-
sumers. In addition, using a familiar
brand name as a diagnostic cue is
thought to be a consumer strategy
for dealing with risk and uncer-
tainty especially when consumers have
knowledge is loss aversion.
21
With loss
aversion, the losses of switching away
from a known brand loom larger than
the potential gains from using another,
lesser-known brand (for example, as
the result of a price reduction). Thus,
the possibility of a potential loss leads
to an advantage for leading brands.
Consumers may rely on the affect
associated with a familiar brand to
aid in their decision-making. Sullivan
22
found that the quality reputation of the
parent brand affected the relative resale
prices of twin automobiles. Brown and
Stayman
23
maintain that ‘halo effects’
related to the positive feelings towards
a brand can positively bias the evalua-
tion of advertising of the brand.
Similarly, consumer confidence is
another potential diagnostic cue that
is derived from a well-developed
knowledge structure. Consumer con-
fidence is increased when consumers
get more familiar in a domain.
24
In
addition, consumer confidence may
lead to greater use of favourable
associations to facilitate decision
making.
25
In summary, consumers are likely to
directly use both the confidence as-
sociated with familiarity as well as
affect transfer when evaluating and
selecting strong brands.
Indirect effects
Indirect effects are perhaps more com-
mon and are evoked when there is
uncertainty or ambiguity in the deci-
sion environment. After brand infor-
mation has been acquired, consumers
may interpret and/or evaluate the
information. This evaluation and en-
hancement may be especially critical
if there are ambiguities associated
with brand-related information. In
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THE MARKETING ADVANTAGE S OF STRONG BRANDS

product consumers may be more loyal
to the brand and have higher evalua-
tions for future brand extensions.
Following on from this con-
sideration of underlying theoretical
mechanisms, the consequences of
strong brands as manifested by
differential consumer response to
marketing activity will now be focused
on.
DIFFERENTIAL RESPONSE TO
MARKETING ACTIVITY
The previous section documented the
different ways in which a strong brand
can have an impact on aspects of
consumer behaviour and consumer
decision-making processes. In this sec-
tion, this paper delves into more detail
about how differences in consumer
brand knowledge affect the response of
consumers to marketing activity. First
the advantages of strong brands are
outlined in five areas of marketing
activity (ie product, extensions, price,
communications and channels). This
paper then looks at situations where
there are advantages for lesser-known
brands, and highlights some of the
limitations of strong brands.
Product-related marketing activities
A product or service is made up of a
bundle of tangible and intangible at-
tributes and benefits designed to satisfy
consumer needs and wants. Consumer
response could differ according to per-
ceptions of attributes and benefits as
well as overall preferences and attitudes
towards the product or service. Con-
sumer response could also differ in
terms of product-related considerations
such as brand loyalty, commitment,
satisfaction, etc.
limited prior experience.
38–41
Hoyer
and Brown
42
found that the presence of
a known brand limited subjects’ability
to detect differences in product quality
across brands, even when subjects
sampled other brands. Clearly, one of
the most effective mechanisms that
provides advantages to strong brands is
their inherent familiarity and the cor-
responding impact of familiarity on
consumer choice.
Summary
Through these three different stages of
consumer behaviour —attention and
learning, interpretation and evaluation,
and choice —advantages have been
documented for strong brands. Many
of the mechanisms cited above are
drawn from the research findings that
follow and are reported in Tables 1-6.
One way to think about how a strong
brand could have an impact on
different aspects of consumer behaviour
is to think about a consumer who is
entering a new product category for
the first time. In the information-
gathering stage, a new consumer may
pay more attention to, and learn
more about, a brand with which
they are familiar. While interpret-
ing and evaluating information, brand
knowledge in many cases could have
both ‘direct’and ‘indirect’effects —
brand-related information could be
input directly into the decision process
or may influence impressions of other
information that is input into the
decision process in various ways. A
brand’s strength will be completely
employed during the choice process if
a new consumer skips a thorough
examination and simply relies on brand
name familiarity as a choice heuristic.
Lastly, having finally purchased the
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Tab l e 1 Differential response to product-related marketing activity
Consumer
response
Brand
knowledge Reference Differential response
New product
evaluation
Corporate
image
Dacin and Brown
a
Subjects’knowledge structures influence their beliefs
about and attitudes towards new products
manufactured by that company.
Brand
purchase rate
Full-line
national
brands
Day and
Deutscher
b
Subjects who mentioned a full-line national brand of
appliance during an initial interview were more likely
to actually purchase the mentioned brand than
subjects who mentioned a specialist brand.
Market share Brand
image and
dominance
Smith and Basu
c
Higher market share observed for a dominant
brand, eg Thailand’simportedScotchwhiskymarket.
Brand quality
perceptions
Brand name
reputation
Dodds et al.
d
Brand name had a positive influence on subjects’
perceptions of quality in all conditions.
Product
evaluation
Brand
pronunciation
Leclerc et al.
e
Subjects rated yoghurt better on hedonic qualities
when it was pronounced with French highlights.
Brand quality
perceptions
Brand name
reputation
Rao and Monroe
f
Reviewed 34 studies and found a significant effect
for the relationship between brand name and quality.
In addition, the effect of brand name as a quality cue
was greater than the effect of size or price as a
quality cue.
Brand quality
perceptions
Brand
experience
Wer n e r f elt
g
If consumers use the experienced quality of a
known brand as an indicator of the quality of a new
‘experience’good, then known brands have an
advantage over new brands.
Brand
preference and
market share
Unique
features
Feinberg et al.
h
Results from a computer simulation based on a
conceptual model show that increasing the unique
features of a brand increases preference and market
share for the brand.
Consumer
confidence and
purchase
intention
Brand
familiarity
Laroche et al.
i
Familiarity with a brand increases consumers’
confidence with the brand and affects intention to
buy. In addition, attitude towards the brand is
affected by familiarity.
Product
evaluation
Prior
exposure to
advertising
Smith
j
Advertising was able to mitigate the effects of
subjects’negative trial experiences.
Product
evaluation
Brand name
reputation
Tse and Lee
k
A strong positive brand image can overcome
unfavourable country-of-component-origin effects.
a
Dacin and Brown, ref. 43;
b
Day and Deutscher, ref. 44;
c
Smith and Basu, ref. 48;
d
Dodds et al., ref. 32;
e
Leclerc
et al., ref. 46;
f
Rao and Monroe, ref. 47;
g
Wernerfelt, ref. 49;
h
Feinberg et al., ref. 50;
i
Laroche et al., ref. 24;
j
Smith, ref. 53;
k
Tse and Lee, ref. 54.
THE MARKETING ADVANTAGE S OF STRONG BRANDS

categories.
57,58
In addition, the amount
of brand equity has been shown to be
correlated with the highest or lowest
quality member in the product line for
vertical product extensions.
59
Research
has also shown that positively evaluated
symbolic associations may be the basis
of these evaluations,
60,61
even if overall
brand attitude itself is not necessarily
high.
62
Brands with varied product category
associations through past extensions
have been shown to be especially
extendible.
63–65
As a result, introduc-
tory marketing programmes for exten-
sions from an established brand may be
more efficient.
66-68
Several studies have
indicated that extension activity has
aided (or at least did not dilute) brand
equity for the parent brand. For
instance, brand extensions strengthened
parent brand associations
69
and ‘flagship
brands’were highly resistant to dilution
or other potential negative effects
due to negative experiences with an
extension.
70,71
Kirmani et al.
72
found evidence of
an ownership effect whereby current
owners generally had more favourable
responses to brand line extensions.
Finally, extensions of brands that
have both high familiarity and posi-
tive attitudes have been shown to
receive higher initial stock market
reactions.
73
Price-related marketing activities
Consumers may differ in terms of the
price they are willing to pay and the
premium that can be supported versus
competitive brands. Consumers may
also differ in terms of how they
respond to price increases and decreases
on either a permanent or temporary
basis.
Table 1 summarises the findings of
previous research with respect to the
differential response to product-related
marketing activity. As this Table shows,
research has demonstrated that different
types of brand associations —if seen as
favourable —can affect consumer
product evaluations, perceptions of
quality, purchase rates and market
share.
43–48
This tendency may be espe-
cially apparent with difficult-to-assess
‘experience’goods
49
and as the unique-
ness of brand associations increases.
50
In
addition, familiarity with a brand has
been shown to increase consumer
confidence, positive attitudes towards
the brand and purchase intention,
51,52
and mitigate the potential negative
impact of a negative trial experience
53
or unfavourably evaluated country of
origin.
54
Extension-related marketing activities
Additions to existing product lines are
often branded and positioned under an
existing brand name as brand exten-
sions. Consumer response could differ
according to how favourably con-
sumers evaluate such extensions and
the amount of marketing support
necessary to achieve a satisfactory level
of extension acceptance with con-
sumers.
Table 2 summarises the findings of
previous research with respect to the
differential response to extension-re-
lated marketing activity. Because of the
emerging interest in brand equity,
much research has been conducted to
understand how consumers’knowledge
of a parent brand can affect evaluations
of a proposed extension. These studies
have shown how well-known and
well-regarded brands can extend more
successfully
55,56
and into more diverse
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Tab l e 2 Differential response to extension-related marketing activity
Consumer
response
Brand
knowledge Reference Differential response
Extension
acceptance
Quality
perceptions
Aaker and Keller
a
Subjects gave a brand extension a higher evaluation
when the original brand was high in quality and the
relationship or ‘fit’between the original brand and
the extension was high.
Extension
acceptance
Quality
perceptions
Bottomley and
Doyle
b
Replicated Aaker and Keller (1990)
a
cross-culturally.
Extension
acceptance
Parent brand
reputation
Gronhaug et al.
c
Parent brand evaluations positively correlated with
brand extension evaluations.
Breadth of
brand extension
High-quality
brand
Keller and Aaker
d
Subjects indicated that a high-quality brand can be
stretched farther (more diverse product categories)
than an average-quality brand.
Extension
capabilities
Highly
valued brands
Rangaswamy et al.
e
Higher valued brand names had higher purchase
intentions when extended to a distant brand.
Vertical product
line extension
Price premium
of the brand
Tay lo r et al.
f
Showed a positive correlation for the amount of
brand equity in different segments of the market.
High-quality segment brand equity correlated with
highest quality member of line and low-quality
segment correlated with lowest quality member.
Brand
extension
evaluation
Symbolic
value
Reddy et al.
g
Measure of the symbolic value of the brand had
positive effects on extensions.
Breadth of
brand
extension
Symbolic
association
Park et al.
h
Symbolic brands can be extended into a wider
variety of contexts.
Brand specific
associations
Brand
knowledge
Broniarczyk and
Alba
i
For high-knowledge subjects, brand-specific
associations moderated the effect of brand affect
when consumers were evaluating a brand extension.
Positive
associations
and consumer
confidence
Breadth of
brand
extension
Dacin and Smith
j
Subjects had more positive associations and greater
confidence in those associations when a brand had
more successful products in different categories.
Favourable
evaluations
Positive
affect and
brand breadth
Sheinin and
Schmitt
k
Subjects favoured brands with positive affect when
the concept was moderately or extremely
incongruous. In addition, subjects gave expansive
brands greater latitude to extend into different
concepts than high-affect brands.
Pioneering
advantage or
market share
Existing
brand
Kerin et al.
l
Order of entry effects were larger for brand
extensions for scanner panel members. In addition,
when a new product class is established, the
order-of-entry effects for brand extensions are
larger for each of the marketing mix variables than
the effects for new brands.
THE MARKETING ADVANTAGE S OF STRONG BRANDS

found for households that are more
loyal.
86
Advertising may play a role in the
decreases in price sensitivity.
87
Bould-
ing et al.
88
claim that unique advertising
messages (for example, product dif-
ferentiation for high-quality products
and low-price messages for low-price
leaders) lead to a reduction in the
susceptibility to future price competi-
tion. Erdem et al.
89
show that brand
credibility decreases price sensitivity.
Lastly, Sullivan
90
used the resale prices
of twin automobiles (the same physical
automobile with two different brand
names) to show how consumers could
use information about the parent brand
when making inferences about the
Table 3 summarises the findings of
previous research with respect to
the differential response to price-
related marketing activity. Although
this only constitutes indirect evidence,
as this table shows, several studies have
demonstrated that brand leaders can
command greater price differences
74–
77
and are more immune to price
increases.
78
In a competitive sense,
brand leaders draw a disproportionate
amount of share from smaller share
competitors.
79–81
Atthesametime,
prior research has demonstrated that
market leaders are relatively immune to
price competition from these small
share brands.
82–85
In addition, lower
levels of price sensitivity have been
430 䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003
Tab l e 2 (Continued)
Consumer
response
Brand
knowledge Reference Differential response
Strength of
parent brand
associations
Dominant
brands
Morrin
m
Exposing consumers to brand extension information
strengthened rather than weakened parent brand
associations in memory, especially for dominant
brands.
Resistance to
dilution
Flagship
product
Roedder
et al.
n
Showed that consumer beliefs about flagship
products (product most closely associated with
brand name, eg Johnson & Johnson baby shampoo)
were highly resistant to dilution.
Resistance to
a negative
experience
Brand
familiarity
Sheinin
o
Brand beliefs and attitudes were unchanged following
a negative (or positive) experience with a brand
extension.
Brand line
extensions
Ownership of
the brand
Kirmani et al.
p
Found evidence of an ownership effect whereby
owners’attitude towards the parent brand led to
more favourable responses to brand line extensions
(except for downward stretches of prestige brands).
Stock market
response
Brand
familiarity and
brand attitude
Lane and
Jacobson
q
Stock market responds most favourably to
extensions of brands that have both high familiarity
and positive attitudes.
a
Aaker and Keller, ref. 55;
b
Bottomley and Doyle, ref. 56;
c
Gronhaug et al., ref. 133;
d
Keller and Aaker, ref. 57;
e
Rangaswamy et al., ref. 58;
f
Tay lo r et al., ref. 134;
g
Reddy et al., ref. 18;
h
Park et al., ref. 61;
i
Broniarczyk and
Alba, ref. 62;
j
Dacin and Smith, ref. 25;
k
Sheinin and Schmitt, ref. 65;
l
Kerin et al., ref. 35;
m
Morrin, ref. 69;
n
Roedder et al., ref. 70;
0
Sheinin, ref. 71;
p
Kirmani et al., ref. 72;
q
Lane and Jacobson, ref. 14.
HOEFFLER AND KELLER

䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003 431
Tab l e 3 Differential response to price-related marketing activity
Consumer
response
Brand
knowledge Reference Differential response
Price sensitivity Equity over
time
Simon
a
Looked at changes in price elasticities over time and
found that consumers had more inelastic responses
to price increases and elastic responses to price
decreases with leading brands over time.
Lower price
sensitivity
(loyalty)
Strong
brand
Agrawal
b
Customers loyal to a strong brand require a larger
price differential in favour of the rival brand before
they will switch away from their favourite brand.
Market share
and price
premium
Familiar
brand name
Park and
Srinivasan
c
Brand name products command both a market share
and price premium, in addition to equity associated
with brand extensions.
Response to
price cut
High market
share brand
Sethuraman
d
Store-level supermarket scanner data indicated that
the leading brand gets the majority of a boost from
discounting when the discounted price is still above
the price of other brands.
Category
choice and
brand choice
National
brands
Sivakumar and Raj
e
Scanner panel data indicates that higher-quality
brands are less vulnerable to losses when prices are
increased.
Market share
and price
sensitivity
High-quality
brand
Allenby and Rossi
f
Rotating indifference curves were used to show that
if switching up to high-quality brands is more likely
than switching down, then there will be asymmetric
responses to price promotions.
Market share
and loyalty
High market
share brand
Grover and
Srinivasan
g
Scanner panel data indicated that when the leading
brand promoted its products, it drew a significant
share from the two follower brand’s brand loyal
segments. Follower brands could not attract the
leading brand’s loyal segment with promotions.
Market share High market
share brand
Russell and
Kamakura
h
Scanner panel data indicated that the largest market
share brand had a greater influence on competitors
when discounted.
Market share High priced
brand
Bemmaor and
Mouchoux
i
In a psuedo experiment with store data,
higher-priced brands were less affected by
reductions in the price of lower-priced brands.
Market share High-quality
and high
priced-brand
Blattberg and
Wisniewski
j
Store-level scanner data indicated that when
higher-price, higher-quality brands were promoted,
they stole share from other brands in the same
price-quality tier and from brands in the tier below.
Lower-price, lower-quality brands did not steal
significant share from the tiers above.
Market share High market
share brand
Bucklin et al.
k
Scanner panel data indicated that the leading brand
could be better insulated against price cuts of
competition.
THE MARKETING ADVANTAGE S OF STRONG BRANDS

differential response to communica-
tions-related marketing activity. A
number of effects have been attributed
to well-known and liked brands.
91
For
example, consumers are more likely to
have a negative reaction to repetition
of advertisements with unknown
as opposed to strong brands.
92,93
Familiar brands appear to better
withstand interference from competi-
tive advertisements.
94
Similarly, con-
sumers appear to have a more negative
reaction to advertising tactics such as
comparative advertisements,
95
depend-
ing on the nature of the brand
involved. Humour in advertisements
seems to be more effective for familiar
or already favourably evaluated brands
than for unfamiliar or less-favourably
evaluated brands.
96–98
used car quality. She found that
parent brand quality reputation affected
the relative resale prices of twin
automobiles.
Communications-related marketing
activities
Marketing communications activities
take all forms —advertising, consumer
and trade promotions, public relations
and event sponsorship, personal selling
etc. Broadly, consumers may differ in
their willingness to attend to a com-
munication, the manner by which they
process a communication, and their
later ability to recall the content of or
their reactions to a communication.
Table 4 summarises the findings of
prior research with respect to the
432 䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003
Tab l e 3 (Continued)
Consumer
response
Brand
knowledge Reference Differential response
Lower price
sensitivity
Loyal
customers of
brand
Krishnamurthi and
Raj
l
Diary panel data were used to show that loyal panel
members were less price sensitive in the choice
decision than non-loyal members.
Lower price
sensitivity
High levels of
advertising
Kanetkar et al.
m
Scanner panel data indicated that, under high levels
of advertising exposure, it is possible for a
household’s brand choice price sensitivity to
decrease.
Consumer
price
sensitivity
Brands with
unique
messages
Boulding et al.
n
Unique messages (product differentiation for
high-quality products and low-price messages for
low-price leaders) led to a reduction in the
susceptibility to future price competition.
Consumer
price
sensitivity
Brand
credibility
Erdem et al.
o
Brand credibility decreases price sensitivity.
Price premium
for used autos
Parent brand
quality
reputation
Sullivan
p
Analysedtheusedcarsalestrendsofused‘twin’
automobiles and found that brands with a higher
quality reputation had higher resale prices.
a
Simon, ref. 74;
b
Agrawal, ref. 75;
c
Park and Srinivasan, ref. 76;
d
Sethuraman, ref. 77;
e
Sivakumar and Raj, ref. 78;
f
Allenby and Rossi, ref. 79;
g
Grover and Srinivasan, ref. 80;
h
Russell and Kamakura, ref. 81;
i
Bemmaor and
Mouchoux, ref. 82;
j
Blattberg and Wisniewski, ref. 83;
k
Bucklin et al., ref. 84;
l
Krishnamurthi and Raj, ref. 86;
m
Kanetkar et al., ref. 87;
n
Boulding et al., ref. 88;
o
Erdem et al., ref. 89;
p
Sullivan, ref. 22.
HOEFFLER AND KELLER

䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003 433
Tab l e 4 Differential response to communications-related marketing activity
Consumer
response
Brand
knowledge Reference Differential response
Advertising
response
Brand
familiarity
Sawyer
a
Response to advertising is stronger, exposure is
non-linear and stronger for subjects who are familiar
with the message or brand.
Product
evaluation
Familiar
brands
Calder and
Sternthal
b
Subjects’response to ad repetition differed for
familiar and unfamiliar brands. Subjects had more
positive evaluation for familiar brands and a more
negative evaluation for an unfamiliar brand in
response to ad repetition.
Advertising
repetition
effects
Known
versus
fictitious
brands
Campbell and
Keller
c
Established brands were more resistant to wear-out
effects than fictitious brands under high ad repetition
conditions.
Advertising
claim recall
Brand
familiarity
Kent and Allen
d
Exposure to competitive advertising had little effect
on claim recall from ads for well-known brands. In
addition, subjects had better memory for new
product information for familiar brands.
Consumer
attitude and
product choice
Positive prior
brand
attitude
Chattopadhyay
and Basu
e
When the prior brand attitude was positive, a
humorous ad was more effective than a
non-humorous ad in changing subjects’attitudes and
choice behaviour.
Advertising
effectiveness
Familiar
brand
Stewart and
Furse
f
Brand-differentiating messages were more effective
for more extensively used or familiar brands.
Advertising
evaluation
Existing
brands
Weinberger and
Gulas
g
Humour was more successful with existing products.
Competitor ad
evaluation
Favourable
brand
attitude
Belch
h
With comparative advertising, the more favourable
the attitude for the existing brand, the less tolerant
subjects were for repetition of the new brand.
Frequency of
purchase
Brand
loyalty
Raj
i
In a frequently purchased product class, panel diary
members of high loyalty increased brand purchase
when advertising for that brand increased.
Advertising
response
Brand
familiarity
Hsu and Liu
j
Consumers with higher perceptions of fluid milk
advertising tended to prefer well-known brands.
Increased
attention
Brand
awareness
and brand
feature recall
Dhar and
Simonson
k
Attractiveness and choice probabilities are enhanced
if an option is the focus of comparison. Brands with
greater awareness and recall of features are more
likely to be the focus of attention.
Increased
attention
Most
attractive
brand
Simonson et al.
l
Information about the most attractive brand was
acquired earlier when making a choice.
THE MARKETING ADVANTAGE S OF STRONG BRANDS

As Table 5 reveals, comparatively
little research has addressed the ques-
tion of channels-related marketing ac-
tivity and brand equity. Montgomery
106
found that products that were from the
top firms in an industry had a much
higher chance of being accepted in the
channel and gaining shelf space in
supermarkets. Fader and Schmittlein
107
proposed that differences in retail
availability may be a key component of
higher repeat purchase rates for higher-
share brands. Also, research suggests
that stores are more likely to feature
well-known brands if they are trying to
convey a high-quality image.
108
The marketing advantages of
lesser-known brands
There are several studies that provide
evidence about areas where non-lead-
ing or even new brands have ad-
vantages over established brands (see
Table 6). As would perhaps be ex-
In addition, consumers who are
highly loyal to a brand have been
shown to increase purchases when
advertising for the brand increased.
99,100
Other advantages associated with more
advertising include increased likelihood
of being the focus of attention
101,102
and
increased ‘brand interest’.
103
Ahluwalia
et al.
104
demonstrated that consumers
who have a high level of commitment
to a brand are more likely to counter-
argue with negative information. This
may be the reason why strong brands
wereshowntobebetterableto
weather a product-harm crisis.
105
Channels-related marketing activity
Distribution activities are those
designed to manage the channel
structure. The response of consumers
may differ in terms of their willingness
to seek the brand within a store, across
stores, or by any other means by which
thebrandcanbeacquired.
434 䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003
Tab l e 4 (Continued)
Consumer
response
Brand
knowledge Reference Differential response
Attention to ad Mature
brands
Machleit et al.
m
Brand interest is created for mature brands. Brand
interest means the consumer now sees the brand in
a new light (eg a consumer would think twice about
thebrandormaybewouldthinkof‘re-trial’of the
brand).
Acceptance of
negative
information
High
commitment
consumers
Ahluwalia et al.
n
Consumers who have a high level of commitment to
a brand are more likely to counter-argue with
negative information.
Loss of brand
equity
Strong and
weak
expectation
brands
Dawar and Pillutla
o
Consumer interpretations of firm response to a
product-harm crisis are moderated by prior
expectations. Strong brands with positive
expectations are more resilient to a product harm
crisis.
a
Sawyer, ref. 91;
b
Calder and Sternthal, ref. 92;
c
Campbell and Keller, ref. 93;
d
Kent and Allen, ref. 11;
e
Chattopadhyay and Basu, ref. 28;
f
Stewart and Furse, ref. 97;
g
Weinberger and Gulas, ref. 98;
h
Belch, ref. 95;
i
Raj, ref. 99;
j
Hsu and Liu, ref. 100;
k
Dhar and Simonson, ref. 21;
l
Simonson et al., ref. 13;
m
Machleit et al., ref.
103;
n
Ahluwalia et al., ref. 104;
o
Dawar and Pillutla, ref. 105.
HOEFFLER AND KELLER

vantage as their segments hold
together better, thus allowing for
more accurate targeting.
—Blair and Innis
115
demonstrated that
consumers deemed a warranty an
important signal of product quality
for unfamiliar brands, but not famil-
iar brands.
—New product features improved
the relative value more for
lesser-known brands than top-tier
brands.
116
—With consumer learning, classical
conditioning effects were strongest
for unknown and moderately
known brands.
117
Finally, there are some differential ef-
fects associated with known brands
that could adversely affect their perfor-
mance. For example, some studies indi-
cate that once a brand is established
in memory it is difficult to change
how consumers think of the brand.
118–
120
Meyers-Levy
121
found that large
pected, several studies show a greater
impact for unknown brands in response
to advertising, brand extensions and
consumer learning.
—Derbaix
109
showed how unfamiliar
brands are more easily influenced by
the affective reactions generated by
their advertisements.
—With comparative advertising, less
familiar brands were later seen as
more similar to brand leaders and
advertisements were more effective
after a delay.
110,111
—For brand extensions, Morrin
112
found that recall of non-dominant
parent brands was improved
through extension activity. In
addition, Broniarczyk and Alba
113
showed how second-tier brands
may have unique extension
opportunities based on the specific
benefits that are associated with the
brand.
—Bucklin et al.
114
showed that smaller
brands may have a targeting ad-
䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003 435
Tab l e 5 Differential response to channels-related marketing activity
Consumer
response
Brand
knowledge Reference Differential response
Retail
availability
High market
share brand
Fader and
Schmittlein
a
Part of the explanation of ‘double jeopardy’for
low-share brands is the existence of an extremely
brand-loyal segment for high-share brands. Another
aspect of the advantage to high-share brands is in
the increased availability at retail locations (smaller
stores that carry fewer brands are likely to carry
thehigh-sharebrand).
Store
advertising
Familiar
brands
Lal and
Narasimhan
b
Consumers use highly familiar brands to help them
gauge the pricing levels of stores. Thus stores are
more likely to advertise these brands to convey a
favourable image to consumers.
Product
acceptance
in channel
To p f o u r o r
five
companies
Montgomery
c
Products that were from the top four or five firms
had a much higher acceptance rate within
supermarkets.
a
Fader and Schmittlein, ref. 107;
b
Lal and Narasimhan, ref. 108;
c
Montgomery, ref. 106.
THE MARKETING ADVANTAGE S OF STRONG BRANDS

436 䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003
Tab l e 6 Marketing advantages of lesser-known brands
Consumer
response
Brand
knowledge Reference Differential response
Advertising
reaction
Brand
familiarity
Derbaix
a
Unfamiliar brands are more easily influenced by the affective reaction
generated by the advertisement.
Brand
similarity
Category
leader
Gorn and
Weinberg
b
Comparative advertising by a challenger (eg a brand not the category leader)
resulted in increased brand similarity between the challenger and leader. The
results held whether an ad for the leader was present or not.
Brand
attitudes
Brand
familiarity
Chattopadhyay
c
Showed that comparative ads do have an advantage over non-comparative ads
when looking at the effects on brand attitudes after a delay. The increased
effectiveness of comparative ads was limited to less-familiar brands.
Brand-name
accessibility
Dominant
brands
Morrin
d
Non-dominant parent brands may benefit more from extension activity than
dominant parent brands.
Brand-specific
associations
Brand
knowledge
Broniarczyk and
Alba
e
A less favourable brand may still be able to extend to some categories that
the leader could not (eg Close-up toothpaste). Close-up breath mints were
evaluated more favourably than Crest breath mints.
Price
sensitivity
High market
share brand
Bucklin et al.
f
Smaller brands may have a targeting advantage as their segments hold together
better.
Relative value Top of line
models
Nowlis and
Simonson
g
New product features improved the relative value more for lesser-known
brands.
Product quality
perceptions
Known
brands
Blair and Innis
h
Consumers evaluated warranty as an important signal of product quality for
unfamiliar brands, but not familiar brands.
Advertising
classical
conditioning
effects
Familiar
brands
Shimp et al.
i
Classical conditioning effects were strongest for unknown and moderately
known brands and were also stronger when the conditioning was embedded
with familiar brands.
Recall and
recognition of
brand
associations
High
frequency
words as
brand names
Meyers-Levy
j
A large number of associations was not necessarily advantageous and could
produce interference effects and lower memory performance.
Specific
associations
Market
leaders
Farquhar and Herr
k
If a brand is seen as representing or exemplifying a category too much, it may
be difficult for consumers to think of the brand in any other way. Thus market
leaders may have strong concrete associations that may not transfer as broadly
to extension categories as more abstract associations.
Perceived
quality, value
and fair price
High equity
brand
Buchanan et al.
l
Evaluations of a ‘high-equity’brand could be diminished by an unfamiliar
competitive brand when: 1) a mixed display structure led consumers to believe
that the competitive brand was diagnostic for judging the high-equity brand
2) the precedence given to one brand over another in the display made
expectations about brand differences or similarities accessible
3) the unfamiliar competitive brand disconfirmed these expectations.
a
Derbaix, ref. 109;
b
Gorn and Weinberg, ref. 110;
c
Chattopadhyay, ref. 111;
d
Morrin, ref. 69;
e
Broniarczyk and Alba, ref. 62;
f
Bucklin et al.,
ref. 84;
g
Nowlis and Simonson, ref. 116;
h
Blair and Innis, ref. 115;
i
Shimp et al., ref. 117;
j
Meyers-Levy, ref. 118;
k
Farquhar and Herr, ref.
119;
l
Buchanan et al., ref. 135.
HOEFFLER AND KELLER

by identifying studies where differential
response to marketing activity of a
brand was shown. The theoretical
mechanisms that were hypothesised to
support the findings of differential
responses accorded to strong brands
were then extracted and catalogued.
This section focuses on insights gained
and makes several summary comments
on the findings from this literature
review.
Broad scope of effects
First, the broad scope and sheer
pervasiveness of the findings are
noteworthy (see Figure 1). Differences
in consumer response due to dif-
ferences in brand knowledge were
found:
numbers of brand associations could
lead to interference effects and lower
memory performance. Farquhar and
Herr
122
contend that market leaders
may have concrete associations that
may not transfer as easily as abstract
associations for brand extensions.
SUMMARY
Discussion and implications
This paper documented academic re-
search from some of the major market-
ing journals that sheds light onto the
marketing advantages of strong brands.
A comprehensive literature review was
performed and research summarised
that either supported or refuted the
customer-based view of brand equity
䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003 437
Figure 1 Brand strength summary
Brand strength Consumer behaviour Differential
marketing efforts
familiarity
m
Awareness
Attention
and learning
m
Consideration
m
Selective attention
Product
m
More favourable attribute and
benefit perceptions
m
Overall preference
Brand
knowledge
m
Strong, favourable and
unique brand associations
m
High-quality brand
Interpretation
and evaluation
m
Direct
m
Indirect
Extensions
m
More favourable consumer response
m
More efficient marketing programme
Brand
performance
m
Market share leader
m
Dominant brand
Choice
m
Heuristic
Price
m
Greater price premiums
m
More favourable response to price
increases and decreases
Communications
Post-purchase
m
Extension evaluation
m
Loyalty
m
Pay greater attention
m
React more positively
m
Retain more information
Brand
THE MARKETING ADVANTAGE S OF STRONG BRANDS

and ultimately have greater
retentionofmessageswhen
communicating brand informa-
tion.
Theoretical mechanisms
Several mechanisms are cited as possible
theoretical mechanisms underlining the
development of brand equity. Again,
this is the first known attempt to
catalogue the mechanisms from which
brand equity advantages are derived.
Yet very few studies actually test
the mechanisms directly. Often, the
mechanisms are put forth as potential
precursors to brand equity, but the
manifestation of brand equity is what is
tested in the study. For instance, the
transfer of affect or ‘halo effect’is
thought to drive many of the advantages
associated with brand extensions. So far,
the amount of research directly inves-
tigating or manipulating how affect is
transferred during the evaluation of
brand extensions is sparse.
Consumer uncertainty
The findings also suggest that these
effects are especially likely to occur in
those circumstances where consumers
feel uncertain,
123
for example, when
ambiguity prevails in the choice or
decision setting, or where there is not
enough information available.
124
In
those situations where consumers lack
confidence, a strong brand can provide
many direct and indirect benefits. For
instance, in low involvement set-
tings where consumers lack either the
motivation or ability to arrive at a
deliberate, well-reasoned decision, they
mayrelyonbrandknowledgeasa
heuristic or allow it to colour their
impressions in various ways.
—With different operationalisations of
brand strength: The most frequent
operationalisations of brand strength
were either simple familiarity with
the brand (in pure experimental
settings) or the leading market
share brand (mostly for quantitative
papers). In addition, specifictypes
of brand knowledge were used as
indicators of brand strength. These
strong, favourable and unique as-
sociations included image, reputa-
tion, high-quality brands, highly
valued brands, positive prior at-
titudes and prior ownership.
—Across different aspects of con-
sumer behaviour: One reason why
these brand knowledge effects are
so widespread is due to the
many different means by which
knowledge effects can emerge.
Knowledge can affect seemingly all
stages and aspects of consumer
behaviour. Consequently, there are
multiple routes by which brand
equity effects can be manifested.
—Across different types of marketing
activities: Nearly every type of
marketing activity is affected by a
strong brand. On the product side,
strong brands get preferential
evaluations of attribute and benefit
information (higher perceived
quality) as well as generally higher
overall preference. Brand exten-
sions of strong brands are shown
to have higher preference levels
and more efficient utilisation of
resources in all aspects of the
marketing programme. The pric-
ing advantages include greater
premiums as well as more
favourable responses to both price
increases and decreases. Lastly,
strong brands garner more atten-
tion, have more positive reactions
438 䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003
HOEFFLER AND KELLER

Future research priorities
The literature review also suggests
several areas where additional research
is needed. In a broad sense, there needs
to be a more detailed understanding of
how specific dimensions of brand
knowledge affect different aspects of
consumer response. This deeper level
of analysis will not be easy, however,
because different dimensions of brand
knowledge are often correlated. For
example, high-equity brands often are
both well known and well liked.
Distinguishing which aspect of brand
knowledge —familiarity or affect —is
creating the differential response in a
particular setting could, therefore, be
quite difficult.
New brands
Firms need better information while
making brand-building decisions. Re-
search should explore the optimal
strategies for new and lesser-known
brands to break into the marketplace
and better compete with brands that
have amassed more brand equity.
What are the best options available for
them? The early decisions firms make
when positioning brands will have
a lasting impact on the associa-
tions consumers hold for the brand.
A better understanding of conse-
quences associated with the trade-offs
firms launching new brands face is
needed. The advantages, for instance,
of building familiarity versus the
advantages of creating a strong,
favourable or unique association when
developing a new brand need to be
clearly spelled out. For example,
many of the now defunct dot com
companies chased familiarity without
paying enough attention to what
associations were being built. Brand
Consumer brand development
Brands may play a critical role when
young consumers are making their
‘initial’choices in a variety of new
domains. As most people with young
children (who may prefer ‘happy
meals’at an early age) can at-
test, brands affect consumers at an
early age. When examining the
consumer socialisation of children,
Roedder
125
catalogued how the use
of brands changes in young con-
sumers as they grow older. Young
consumers move from pure familiarity
to more sophisticated symbolic repre-
sentations. Specifically, Achenreiner
and Roedder
126
show that, for
younger children, brand familiarity
may provide the most advantages for
products while, for older children,
the specific associations attached to
the brand become more important
(see also Nguyen and Roedder
127
and
Zhang and Sood
128
). If existing strong
brands play a critical role in the
crucial preference-development phase
then these brands should have long-
term advantages as new consumers
enter the marketplace. In fact, brand
loyalty has been shown to be more
stable for brands that are market
leaders (Dekimpe et al.
129
).
Summary
In short, brand advantages can be
manifested in many different ways.
Moreover, the more ‘difficult’the
situation that consumers face, the more
likely it is that these brand advantages
will be evident. At the same time,
lesser-known brands do have several
of their own advantages, although
primarily these reflect the fact that
these types of brand have much ‘room
for improvement.’
䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003 439
THE MARKETING ADVANTAGE S OF STRONG BRANDS

decision making, consider the use of
emotions in processing brand-related
information, and so on.
Effects on attention and learning
Thereappearstobelessemphasisin
the literature on understanding the
brand knowledge advantages in atten-
tion and learning. How do strong
brands benefit from more developed
knowledge structures in marketing
activities designed to build brand
equity? Almost every paper in this
review focused on the consequences of
brand equity once it was either
established in the market (known
brands) or developed in the context
of an experiment (fictitious brands).
While there has been a fair amount of
work on topics around the building of
brand equity, it would be worthwhile
to better understand which brand-
building techniques lead to the largest
differential responses once brand equity
is established. The answer may depend
on whether the brand is an entirely
new brand or an existing brand that is
trying to reposition to better fitthe
needs in the market.
Channels
From the perspective of a marketing
programme, the most neglected re-
search area appears to be how different
levels of brand equity affect the ef-
fects of various channel strategies and
tactics. A number of different issues
are relevant here —channel accept-
ance of new products depending on
brand strategy and the equity involved,
how national brands affect the equity
of retailer brands and vice versa, and
so on. Along those lines, one useful
research study would be to update
managers at these companies may have
held the incorrect belief that all the
advantages of brands are built by being
well known.
130
In addition, a more
thorough understanding is needed of
the differences between abstract and
concrete associations and the limita-
tions of each type of association. In
general, more information is needed
about how best to build strong brands
whose advantages will be the most
resistant to changes brought on by the
introduction of new products or
changes in the preferences of con-
sumers.
Theoretical mechanisms
As the discussion of the mechanisms
indicated, many of the potential causal
mechanisms have not been tested
directly. For instance, one area that
needs to be carefully investigated is
brand affect. The popular press is rife
with examples of companies that are
changing their advertising in an
attempt to create an emotional bond
with their customers. In just the last
six months, firms in industries as
varied as motor vehicles, insurance
and pharmaceuticals have publicly
stated their goal of increasing the
emotional tie with consumers. With-
out fully understanding the antece-
dents and consequences of potential
emotional bonds, these firms have
little research to guide them. A good
start towards understanding the an-
tecedents of brand affect is provided
by Chaudhuri and Holbrook.
131
More
knowledge is needed of how affect is
generated and how it influences
consumer behaviour and response to
marketing activity. In particular, such
research should more closely examine
the affect-transfer process in consumer
440 䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003
HOEFFLER AND KELLER

information’,Journal of Consumer Research,
Vol. 11, June, pp. 42–50.
(10) Alba, J. W. and. Hutchinson, W. J. (1987)
‘Dimensions of consumer expertise’,Journal
of Consumer Research, Vol. 13, March,
pp. 411–455.
(11) Kent, R. J. and Allen, C. T. (1994)
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consumer memory for advertising: The role
of brand familiarity’,Journal of Marketing,
Vol. 58, July, pp. 97–105.
(12) Bowman, D. and Gatignon, H. (1996)
‘Order of entry as a moderator of the effect
of the marketing mix on market share’,
Marketing Science,Vol.15,No.3,
pp. 222–242.
(13) Simonson, I., Huber, J. and Payne, J. (1988)
‘The relationship between prior brand
knowledge and information acquisition
order’,Journal of Consumer Research,Vol.14,
March, pp. 566–578.
(14) Lane, V. R. and Jacobson, R. (1995) ‘Stock
market reactions to brand extension
announcements: The effects of brand
attitude and familiarity’,Journal of Marketing,
Vol. 59, No. 1, pp. 63–77.
(15) Lehmann, D. R. and Pan, Y. (1994)
‘Context effects, new brand entry, and
consideration sets’,Journal of Marketing
Research, Vol. 31, August, pp. 364–374.
(16) Simonson et al., ref. 13 above.
(17) Hasher, L. and Zacks, R. T. (1979)
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memory’,JournalofExperimentalPsychology:
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(18) Reddy, S. K., Holak, S. and Bhat, S. (1994)
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Marketing Research,Vol.31,No.5,
pp. 243–262.
(19) Tellis, G. J. (1988) ‘Advertising exposure,
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(20) Kent and Allen, ref. 11 above.
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(24) Laroche, M., Kim, C. and Zhou, L. (1996)
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Montgomery’s
132
classic paper and ex-
plore the decision processes of retailers
from a branding perspective. How does
the equity of brands affect the various
stages involved?
Brand equity development
Lastly, as mentioned earlier in this
summary, it is necessary to bet-
ter understand the role of brands
during the critical preference-develop-
ment stage for young consumers as
well as improve the understanding of
the role of brands as consumers’tastes
change and mature. Although brand
preferences persist in many categories,
one can think of many categories
where brand preferences may be more
labile as consumers acquire more
sophisticated tastes. For instance, many
people who drink wine migrate from
the sweeter entry-level wines they
initially consume when entering the
wine category. It would be interesting
and useful to have a better understand-
ing of the role of brands in the
maturation of tastes.
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‘‘‘Abercrombie & Fitch —That’sme’’:
Brand names in children’s self concepts’,
working paper.
䉷HENRY STEWART PUBLICATIONS 1350-231X BRAND MANAGEMENT VOL. 10, NO. 6, 421–445 AUGUST 2003 445
THE MARKETING ADVANTAGE S OF STRONG BRANDS