BRAND EQUITY

THE BRAND AS AN ASSET

ALL BRANDS ARE INTANGIBLE ASSETS AND HENCE ARE FUTURE GENERATORS OF CASH FLOWS.

MANAGING AN ASSET

WHAT ARE THE THINGS ONE HAS TO DO WHILE MANAGING ANY ASSET?

MANAGING AN ASSET

ENSURE THAT THE ASSET IS WORKING FINE. REPAIR FAULTS, IF ANY. TRACKING THE CHANGE IN VALUE OF THE ASSET. REPLACE OR INVEST IF NECESSARY.

MANAGING AN ASSET

DAGMAR, BAV ETC. ARE THE CHECKS IF THE ASSET IS WORKING FINE. ITS THE PREVENTIVE MAINTENANCE OF THE BRAND ON AN ONGOING BASIS. FREQUENCY OF MAINTENANCE DEPENDS ON THE VALUE OF THE ASSET.

MANAGING AN ASSET

WE NOW MOVE TO THE SECOND PART OF MANAGING AN ASSET TRACKING THE VALUE OF THE ASSET.

WHY?

WHY IS THERE ALL THIS RECENT ATTENTION ON BRAND EQUITY?

WHY BRAND EQUITY?

THE NEED FOR ACCOUNTABILITY FOR THE MARKETING FUNCTION. ERGO: THE RETURN ON INVESTMENT FOR MARKET SPEND.

WHAT IS BRAND EQUITY?

SO: WHAT IS BRAND EQUITY?

BRAND EQUITY

OUTCOMES THAT ACCRUE TO A NEED / WANT SATISFIER WHEN THE BRAND NAME IS ADDED ON.

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OUTCOMES?

AND FOR A COMMERCIAL BRAND, WHAT ARE THESE OUTCOMES?

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OUTCOMES
CAPABILITY TO CHARGE A PREMIUM. CAPABILITY TO INCREASE SALES. CAPABILITY TO GET A DISCOUNT. CAPABILITY TO WITHSTAND ATTACKS LIKE PRICE CUTS, SALES PROMO SCHEMES, MARGIN ATTACKS.

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COME TO THE POINT!

WHY WASTE TIME DOING ALL THIS WONT MEASURING SALES OR MARKET SHARE SIMPLY BE BETTER?

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THE COUNTERPOINT
SALES LOOKS AT HISTORY THIS MAY NOT ALWAYS BE THE BEST INDICATOR OF THE FUTURE. IGNORES IMPACT OF INCREASED COMPETITION. SALES COULD BE BOUGHT BY USING SHORT TERM MEASURES LIKE SALES PROMOTION.

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THE COUNTERPOINT

IN OTHER WORDS, WE NEED TO LOOK AT SHORT TERM CASH FLOW VERSUS LONG TERM CASH FLOW GENERATION.

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THE CHALLENGE?

WHAT IS THE BIGGEST CHALLENGE TO THE MEASUREMENT OF BRAND EQUITY?

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THE CHALLENGE

THE OBJECTIVE IS CASH FLOW GENERATION. TRADITIONAL MARKETING METRICS CANNOT PREDICT THIS WITH THE LEVEL OF ACCURACY DESIRED.

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TRADITIONAL METRICS

AWARENESS. THE BAV METRICS. DISTRIBUTION STRENGTH. PERCEIVED VALUE/PRICE.

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THE EXISTING MODELS

BRAND EQUITY MEASUREMENT HAS SOME INDUSTRY ACCEPTED MODELS. ONE OF THEM HAS ALREADY BEEN COVERED BY YOU: BRAND ASSET VALUATOR MODEL.

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CONSTRUCTING A MODEL

KEY CRITERIA FOR A MODEL OF BRAND EQUITY:

LIKE MARKET SHARE, SHOULD HAVE A BOTTOM LINE IMPACT. UNLIKE MARKET SHARE, SHOULD BE ABLE TO GIVE PRESCRIPTIONS.
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CONSTRUCTING A MODEL

GIVEN BELOW ARE MARKET SHARES FOR THREE BRANDS:

A: 26% B: 34% C: 40%

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ROBUSTNESS

WHAT OTHER INFORMATION WILL YOU NEED TO PREDICT ROBUSTNESS OF THE BRAND IN THE SHORT RUN?

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SHORT RUN ROBUSTNESS

THE BREAK UP OF MARKET SHARE FROM LOYAL CONSUMERS. TIME SERIES DATA.

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SHORT RUN ROBUSTNESS

REFER TO THE CASE ODD BALL DETERGENTS AND THE PROCESS USED TO MEASURE LOYALTY INDEX.

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LONG RUN ROBUSTNESS

HOW WOULD YOU DEFINE LONG RUN ROBUSTNESS?

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LONG RUN ROBUSTNESS

CONSISTENCY IN PERFORMANCE. INSULATION FROM TRENDS. GOOD PERFORMANCE OVER THE PLC STAGES.

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LONG RUN ROBUSTNESS

HOW CAN WE GET:

CONSISTENCY IN PERFORMANCE? INSULATION FROM TRENDS?

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LONG RUN ROBUSTNESS

BRAND RESILIENCE WE NEED SOME METRICS TO MEASURE THIS.

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LONG RUN ROBUSTNESS

HOW CAN WE GET:

GOOD PERFORMANCE OVER THE PLC STAGES?

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LONG RUN ROBUSTNESS

BRAND LEVERAGIBILITY OR THE CAPABILITY TO STRADDLE OTHER NEED OR WANT SATISFIERS.

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BRAND RESILIENCE

HOW DO WE MEASURE BRAND RESILIENCE OR THE CAPACITY OF THE BRAND TO DELIVER CONSISTENCY IN PERFORMANCE, INSULATED FROM TRENDS?

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AN EXERCISE

REEBOK. BATA. ADIDAS. NIKE.

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QUALITY

RATE THE BRANDS BASED ON QUALITY (SUPERIOR, GOOD, ACCEPTABLE, POOR)

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PRICE

RATE THE BRANDS BASED ON PRICE (PRICE NOT A BARRIER, PRICE IS A MINOR BARRIER, PRICE IS A MAJOR BARRIER, PRICE IS AN ABSOLUTE BARRIER).
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BELIEFS

THIS REFLECTS YOUR BELIEFS ABOUT THE BRAND.

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PURCHASE

WHICH BRAND WILL YOU PURCHASE?

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PURCHASE

THIS REFLECTS YOUR BEHAVIOUR.

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OUTPUT

TABULATE Q1P1, Q1P2, Q1P3, Q1P4 Q4P4 FOR THE CATEGORY. REPEAT FOR INDIVIDUAL BRANDS.

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OUTPUT

THE RELATIVE WEIGHTAGES IN THE CELLS GIVE US THE WEIGHTAGE GIVEN TO QUALITY VIS--VIS PRICE (BRAND PARITY INDEX). IT ALSO GIVES THE POSITION OF OUR BRAND.

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STORE DATA

STORE DATA WILL GIVE YOU THE % OF LOYAL CUSTOMERS IN EACH BOX AND THE MOVEMENTS OVER TIME.

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LOYALTY?

HOW DO WE TACKLE PRODUCTS WHERE MEAN TIME BETWEEN PURCHASES IS HIGHER?

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LOYALTY?

WHY IS THERE A DIFFERENCE BETWEEN MARKET SHARE AND BRAND EQUITY IN CASE OF SUCH PRODUCTS?

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LOYALTY?

DIFFERENCES IN MOMENTUM. TIME SERIES DATA REFLECTS THIS BUT CANNOT PINPOINT THE REASON.

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THE POSSIBLE MEASURES?

WHAT COULD BE THE POSSIBLE WAYS OF PINPOINTING CAUSE OF CHANGE IN MOMENTUM?

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THE POSSIBLE MEASURES?

REGRESSION ANALYSIS. CONJOINT ANALYSIS.

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