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Ebooksclub.org Brands Laid Bare Using Market Research for Evidence Based Brand Management[2]

Ebooksclub.org Brands Laid Bare Using Market Research for Evidence Based Brand Management[2]

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Published by Rahimi Amin

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Published by: Rahimi Amin on Jun 05, 2012
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10/10/2013

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Brand pull covers people’s attitudes to brands and categories. It covers all

the factors that indicate someone’s likelihood to buy a brand, once it has

been made available and drawn to their attention. Apart from brand equity,

the other influential factors are price/value, involvement and mobility.

Each of these is discussed below.

Price and Value

Understanding and measuring the workings of price is a vast subject, and

here we draw attention to only a couple of aspects.

First, it should be appreciated that price is simply a choice of brand

position in a market. There is no general relationship between a brand’s

relative price and its market share. In some categories the premium price

brands are successful, while in others the lower priced brands are successful.

This is illustrated in Figure 6.1, which was compiled using research and

development work by Ipsos.

The important concept is value for money, meaning the combination

between price and the desire to buy the brand. It doesn’t matter what price

you charge, so long as it is appropriate for what you are offering, represented

by the brand equity.

Value is the important concept, but it is not very insightful to ask people

to give a direct rating of the value for money of a brand. A better approach,

certainly one that produces a better explanation of their behaviour, is to ask

their perceptions of price (not value) or to use actual market price. Then

we compare this to each brand’s equity and obtain a measure of value for

money.

To do this well you need to allow for the varying importance of price

in different categories, and to take into account how price is presented

and interpreted. In some cases price is very visible and straightforward

(e.g. consumer packaged goods). In other categories, such as financial

services, it is important but more complicated. The way a consumer

identifies and determines the price of a service, or the return on an

investment, may not be consistent or logical. There are also some areas

where price plays no part at all, such as choice between terrestrial

television channels or radio channels, though the major themes within

brand equity do still apply.

Of course, this line of analysis assumes that price and equity are

independent of each other. It carries the logic that if you reduce your price

so your product becomes more ‘desirable’, then your equity will stay the

same but your brand’s value for money will become stronger. This may well

be true for small price movements, but care is needed. In many cases people

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TURNING BRAND EQUITY INTO SALES

infer a level of quality according to the price they are charged. Occasionally

you find a category where quality is objectively visible, although this is rare.

More often it is a combination of some objective judgement and a lot of

blind faith, and some brands deliberately play on this fact, for example

Stella Artois with its slogan ‘reassuringly expensive’.

The measure of value for money is not necessarily a simple equation

between equity and price across a whole category. Towards the upper end,

the premium manufacturers’ brands need to lean heavily on all aspects of

equity, in order to justify their price. At the lower end, including

supermarkets’ own labels, it is more a question of the brand simply being

‘good enough to do the job’.

Consumers’ Involvement

You can identify brands from different categories with equally good equity,

price and marketing support, but sometimes you find they achieve different

levels of success in the marketplace. The reason for this is often consumers’

B RAN D PULL

123

Figure 6.1 Market share vs relative price.

Reproduced with kind permission from IPSOS.

level of ‘involvement’ in the category and the brand. At the category level,

involvement means the extent of consumer interest in the category: how

much they care about their choice of brands. If they do not care very much,

it weakens the benefit you can expect from positive attitudes to the brand.

They say your brand is fantastic, but in the end they may not care enough

for that attitude to turn into choice behaviour.

One classic example of this is the batteries category. People have many

positive perceptions of the brand Duracell, but that level of positive

attitude does not translate into sales as strongly as we find in other

categories.

The category attitude is modified by a more specific attitude to each

brand. This emerges as a question of substitutability, meaning the question

of whether another brand is considered able to do the same job. It operates

as a tougher test than simply identifying differences in perceptions between

two brands.

You might expect that this issue would be strongly connected to the price

position of the brand, but this is not always so. As an example, consider a

study of the UK dog food market carried out in the early 1990s. The study

revealed the fairly typical characteristic of a closely competing group of

medium-low price brands (Bounce, Chappie, Bonus), but also a distinct low

price brand (Chappie) that did not overlap with the others at a similar

price level. The brand Chappie in the UK had a particular formulation that

was recommended by vets for its digestive qualities, so it had a genuine

point of difference. (Note that the brand name Chappie is applied to

different products in other countries.)

What we should learn from this is that any brand can have an aspect that

creates a distinctive point of difference, regardless of its price position in

the category.

These things can sometimes change quite quickly. A category can

become commoditised, so people believe it is not worth buying ‘better’

products. In such a case many consumers become bargain hunters,

increasingly susceptible to the promotional activity of shops’ own labels,

thus reducing the amount of purchases they make of the higher-priced

brand. If the big brands join in price wars, they increase the likelihood of

consumers’ losing faith in their quality.

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TURNING BRAND EQUITY INTO SALES

Mobility and Inertia

Generally, consumers have become more confident. They have fewer

anxieties about brands and are more confident about switching or simply

checking out different brands. There is more choice available, and they

have been increasingly encouraged to try different brands. Years ago, if

someone had a low level of involvement or care about a category, then they

would most likely stick with one familiar brand. Nowadays, a similar low

attitude is more likely to mean that they see many brands as potential

substitutes for each other, and so have little inclination to stick with one.

Positive involvement in a category, or concern about which brand to

choose, used to manifest itself as careful selection of the one brand you felt

suited you best. Now, such positive involvement is likely to mean an

enthusiasm for trying new brands and a selection of a repertoire of brands to

meet different needs on different occasions. High involvement means

someone is more likely to choose the better quality or higher priced brands,

but it generally does not mean higher behavioural loyalty to a brand.

Behavioural loyalty to a brand is declining.

We talk about a dimension of ‘mobility’ and its opposite, ‘inertia’. A

mobile consumer is one who is highly mobile between brands. They are

inclined to make changes. Even if they are reasonably satisfied with a brand

they may wish to check out other brands, either because they enjoy doing

so, or to find out if there is a better alternative available. Inertia is the

opposite concept, meaning an inclination to stick with a brand, even if you

are dissatisfied with it.

Changes taking place in the modern world of brands mean there is more

mobility and less inertia. In some cases there has been a practical reduction

in the ‘pain of change’, making it physically easier to move. For example, it

has become easier in the UK to switch suppliers of various financial services,

such as current accounts and mortgages. The reduction in the pain of change

is, for the most part, also a change of mindset as well as physical constraints.

Over recent years the financial services category has seen the arrival of

new market entrants offering very good deals, successfully attracting

customers. The new customers are, by nature, very mobile and demanding.

So, subsequent reductions in the financial value of those products inclined

B RAN D PULL

125

many of those customers to look elsewhere. Mobility works both ways: it is

easier to attract mobile customers but also easier to lose them.

The reverse situation is often found for long-established market

leading brands, such as Prudential or British Telecom. They are likely to

have relatively strong behavioural loyalty, compared to the attitudes to

the brand, since they will have many immobile customers – people who

can’t be bothered to move, even if they are dissatisfied. Over time there

is a risk that this may become a problem, as these markets have opened

up to greater competition and the arrival of new types of company,

which encourages even relatively immobile people to rethink their

situation.

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