Measuring Brand Equity

Models Brand Asset Valuator Brand Resonance Aakers model Intebrands brand Valuation BrandZ BDI & CDI

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Chapter Questions
What is a brand and how does branding work? What is brand equity? How is brand equity built, measured, and managed?

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Brand

A name, term, sign, symbol or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.

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Attributes of Strong Brands

Excels at delivering desired benefits Stays relevant Priced to meet perceptions of value Positioned properly Communicates consistent brand messages Well-designed brand hierarchy Uses multiple marketing activities Understands consumer-brand relationship Supported by organization Monitors sources of brand equity
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The Role of Brands

Identify the maker Simplify product handling Organize accounting Offer legal protection

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The Role of Brands

Signify quality Create barriers to entry Serve as a competitive advantage Secure price premium
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Brand Equity

The differential effect that brand knowledge has on consumer response to the marketing of that brand.

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Brand Knowledge
Thoughts Knowledge Feelings

Beliefs Experiences

Images

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Brand Associations

Strong Unique

Favorable
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Marketing Advantages of Strong Brands

Improved perceptions of product performance Greater loyalty Less vulnerable to competition Less vulnerable to crises Larger margins Inelastic consumer response to price increases Elastic consumer response to price decreases Greater trade cooperation Increase in effectiveness of IMC Licensing opportunities Brand extension opportunities
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Brand Equity Models

Brand Asset Valuator Aaker Model BRANDZ Brand Resonance BDI & CDI

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Brand Asset Valuator (BAV)

A model devised by Young & Rubicam- a most ambitious effort !

Measured brand equity for 450 global,8000 local brands Thirty two item questionnaire with a four set of measures
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Brand Asset Valuator (BAV)

The four measures are Brand Equity
Hypothesis that Brands are built sequentially along these 4 dimensions

Differentiation

Knowledge

Relevance

Esteem

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Brand Asset Valuator (BAV)

Differentiation measures how distinctive the brand is in the marketplace Relevance Measures whether a brand is meaningful or personally relevant Esteem Measures whether a brand is held in high regard and has a high perceived quality Knowledge Measures the understanding of brand by consumers
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Brand Asset Valuator (BAV)

Differentiation measures how distinctive the brand is in the marketplace Relevance Measures whether a brand is meaningful or personally relevant D * R = BRAND STRENGTH Strong brand must have a high strength Growing brands and established brands are high on strength Hallmark , Disney
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Brand Asset Valuator (BAV)

Esteem Measures whether a brand is held in high/low regard and has a high/low perceived quality Knowledge Measures the understanding of brand by consumers, built not by exposures,but by intimacy with the brand E * K = BRAND STATURE High in esteem and low in knowledge = unrealised potential = Crayola, Nat.Geographic High in knowledge and low in esteem = losing penetration, or serve polarised opinions cigarettes, alcohol, MTV
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BAV Power Grid

Low
Brand Stature E*K

High

Strong niche High brands Increase in stature Brand Strength thru knowledge D*R New unfocussed brands Low Dangerous to stay too long here

Great equity to protect and High exploit Leadership Tired brands, but still retain some esteem and Low knowledge Eroding/sinking
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BAV Power Grid

Low High
Strong ,niche Brand Strength D*R
10 9 8 7 6 5 4 3 2 1 0 D R E K

Brand Stature E*K Leadership

3-D Column 1 10 9 8 7 6 5 4 3 2 1 0 D

High High
R E K

Low
New, unfocussed

10 9 8 7 6 5 4 3 2 1 0 D R E K

Decline

10 9 8 7 6 5 4 3 2 1 0 D R E K

10 9 8 7 6 5 4 3 2 1 0 D R E K

Low

Tired but still known

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Brand Asset Valuator (BAV)

Points to be noted :
Not easy to be high in differentiation and relevance, very few like Disney are high on brand strength High stature brands have rich heritage, longevity, identity Coke, Hallmark,Campbell Brands revitalised by extensions or relaunch have high stature/strength Stature differs from country,regions, demographic/pychographic profiles Pkg . Goods in US, vs cars in Japan
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Drivers of Brand Equity

Brand Elements

Marketing Activities Meaning Transference

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Brand Elements
Brand names Slogans

URLs

Elements Logos

Characters

Symbols
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Brand Element Choice Criteria

Memorable Meaningful Likeability

Transferable Adaptable Protectible

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Slogans
Like a good neighbour State Farm is there Just do it Nothing runs like a Deere Help is just around the corner Save 15% or more in 15 minutes or less Hungry kya? We try harder Well pick you up Nextel Done Zoom Zoom Im lovin it Innovation at work This Buds for you Always low prices We also make steel
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Aaker Model Brand Identity

Brand-as-product

Brand-as-organization

Brand-as-person

Brand-as-symbol

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Aaker Model Brand Assets

Brand loyalty Brand associations Proprietary assets Brand awareness Perceived quality

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Brand Resonance

Brand Resonance refers to the extent to which customers feel in sync with the brand. Just as we feel the vibe between ourselves and others, we also experience a vibe that resonates between ourselves and brands.

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Brand Resonance
There are four categories to brand resonance: Behaviour - such as frequent purchase. Attitude when we say we love the brand. Sense of community such as the Harley Owner's Group (HOG), Santro family Active engagement where people invest time and money beyond purchase or consumption.

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Brand Resonance Pyramid

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Secondary Sources of Brand Knowledge

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Brand Resonance
Brand Identity The outward expression of
the brand, including its name and visual appearance. The brand's identity is its fundamental means of consumer recognition and symbolizes the brand's differentiation from competitors. Brand Salience No. of respondents who have an opinion on the brands, goes beyond awareness, recognition and recall. Considered while buying
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Brand Resonance
Noel Coburn , neuroscientist : If print advertising was added to television advertising for a particular brand then there was an increase in brand salience. The combination of the two also enhanced memorability of communication and strengthened the brand values. Moreover, print advertising helps in reaching the 'hard to get' targets. Television advertising only starts to be effective from the moment there is a clear brand cue. On the other hand, print does not suffer because it is a static medium. It allows users to extract all the meanings of the ads at the reader's speed and hence it doesn't suffer from the processing problems that television suffers from, Coburn stated.

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Brand Resonance
Brand Image
How the brand is now perceived Limited by time Could be passive and relate to the past Tactical

Image : perception now Identity : how the marketer wants it to be perceived Position : communication of identity and value proposition
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Measuring Brand Equity

Brand Audits

Brand Tracking

Brand Valuation

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Interbrands Brand Equity Formula

Brand earnings Brand sales Costs of sales Marketing costs Overhead expenses Remuneration of capital charge Taxation Brand strength Leadership (25%) Stability (15%) Market (10%) Geographic spread (25%) Trend (10%) Support (10%) Protection (5%)
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The 10 Most Valuable Brands

Brand 1990 Coca-Cola Coca cola Microsoft Kelloggs IBM Mc Donalds GE Intel Kodak Marlboro 2004 Brand Value (Billions) $67.39 $61.37 $53.79 $44.11 $33.50 $27.11 $25.00 $24.04 $22.67 $22.13
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Disney IBM McDonalds AMEX Nokia Toyota Marlboro Sony Mercedes Nescafe

Managing Brand Equity

Brand Reinforcement

Brand Revitalization

Brand Crises

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