ABSTRACT
The monetary value of brands is impressive. In a ranking from 2014, the consulting agency Interbrand, for instance, estimated the brand equity of Apple to be more than $118 billion USD. In many cases, the monetary value of a brand even exceeds the monetary value of all other assets of a company. Whilst part of the monetary value of the world’s leading brands can unarguably be attributed to the high quality or innovativeness of their products and services, much of the benet of brands is based on psychological eects. Take the brand “Stradivarius” as an example. Stradivari was a traditional Italian crafter who built string instruments with a leading quality more than 200 years ago. The instruments are still played by professionals today and are sold for record prices at auctions, sometimes for more than $2 million USD for a single instrument. The most fascinating fact about this, however, is not that antique instruments receive high bids at auctions or that professionals are willing to pay large amounts of money to play such an exceptional instrument, but that, in blind tests, professionals cannot distinguish the sound of a Stradivarius violin from that of other prominent violins that cost only $10,000 USD – a small fraction of the price of a Stradivarius (Fritz, Curtin, Poitevineau, Morrel-Samuels, & Tao, 2010). Hence, an instrument made by Stradivari obviously provides a utility that goes beyond the functional benet of producing an excellent acoustic experience. Instead, research suggests that the value of the brand Stradivarius depends on a unique bundle of brand associations and benets that “work in concert” to create a distinctive brand perception.
