Branding s10 ch8&9 moghimi brand equity measurement ug

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Information about Branding s10 ch8&9 moghimi brand equity measurement ug

Published on December 11, 2013

Author: bmoghimi



brand equity measurement 1

Strategic Branding – Part 1 Developing a Brand Equity Measurement System Measuring Sources of Brand Equity Professor: Bahman Moghimi Doctor of Business Administration M.Sc. Of “Industrial Marketing & e-Commerce” 3

What is Customer Equity?  The ultimate aim of customer relationship management is to produce high customer equity that is combined discounted customer lifetime values of all the company’s current & potential customers – 4 The more loyal the firms profitable customer, The higher the firm’s customer equity

Customer Equity 5

The Customer/Brand Challenge  In this difficult environment, marketers must have a keen understanding of: – – – 6 customers brands the relationship between the two

The Concept of Brand Equity   The brand equity concept stresses the importance of the brand in marketing strategies. Brand equity is defined in terms of the marketing effects uniquely attributable to the brand. – 7 Brand equity relates to the fact that different outcomes result in the marketing of a product or service because of its brand name, as compared to if the same product or service did not have that name.

How Brands Are Built Four Primary Aspects • The culmination of brand building efforts; acquisition of consumer experience Knowledge • Consumer respect, regard, reputation; a fulfillment of perceived consumer promise Esteem • Relates to usage and subsumes the five Ps of marketing; relates to sale Relevance • The basis for consumer choice; the essence of the brand, source of margin Differentiation 9.8

Keller's Brand Value Chain The Brand Value Chain(BVC) is a structured approach to assessing the sources and outcomes of brand equity and the manner by which marketing activities create brand value. • • • • Step I- Firm invests in a marketing program targeting actual or potential customers Step II- The associated marketing activity then affects the customer mind-set Step III- This produces the brand’s performance in the marketplace – how much and when customers purchase, the price that they pay and so forth. Step IV- The investors considers this market performance and other factors to arrive at an assessment of shareholder value in general and a value of the brand. 9

Keller's Brand Value Chain 10

Customer-Based Brand Equity  11 Customer-based brand equity – Differential effect – Customer brand knowledge – Customer response to brand marketing  Determinants • Customer is aware of and familiar with the brand • Customer holds some strong, favorable, and unique brand associations in memory

Building Customer-Based Brand Equity  Brand knowledge structures depend on . . . 12 The initial choices for the brand elements – – The supporting marketing program and the manner by which the brand is integrated into it – Other associations indirectly transferred to the brand by linking it to some other entities

Benefits of Customer-Based Brand Equity     13   Enjoy greater brand loyalty, usage, and affinity Command larger price premiums Receive greater trade cooperation & support Increase marketing communication effectiveness Yield licensing opportunities Support brand extensions.

Customer-Based Brand Equity as a “Bridge”  Customer-based brand equity represents the “added value” endowed to a product as a result of past investments in the marketing of a brand. 14  Customer-based brand equity provides direction and focus to future marketing activities 15

Strategic Brand Management 16 Strategic brand management involves the design and implementation of marketing programs and activities to build, measure, and manage brand equity.   The strategic brand management process is defined as involving four main steps: 1) 2) 3) 4) Identifying and establishing brand positioning and values Planning and implementing brand marketing programs Measuring and interpreting brand performance Growing and sustaining brand equity

Strategic Brand Management Process STEPS KEY CONCEPTS Identify and Establish Brand Positioning and Values Mental maps Competitive frame of reference Points-of-parity and points-of-difference Core brand values Brand mantra Plan and Implement Brand Marketing Programs Mixing and matching of brand elements Integrating brand marketing activities Leveraging of secondary associations Measure and Interpret Brand Performance Grow and Sustain Brand Equity 17 Brand Value Chain Brand audits Brand tracking Brand equity management system Brand-product matrix Brand portfolios and hierarchies Brand expansion strategies Brand reinforcement and revitalization

What to Track for Branding Measurement   18   Awareness: both recall and recognition measures should be collected. Usage: this can be measured through recency, frequency of usage, and total spending in the brand, and product category. Brand Attitudes and Perceptions: Product and non-product associations, as well as those related to price and value are important sources of brand equity and should be part of brand tracking studies. Purchase intent: measures of likelihood to buy a brand or switch to a competitor are also indicators of brand health and should be part of brand tracking 19

How to Track for Branding Measurement 20 Frequency of product purchase: for example durable goods with long purchase cycles can be tracked less frequently.   Marketing activity in the product category: a category where brands are constantly launching marketing programs and promotions should be monitor more often.  Level of competition in product category: highly competitive product categories, where new products and competitors are constantly trying to break in, should be tracked regularly.  Stability of brand associations: brands with an established image that don't show appreciable changes over time, can afford a less frequent brand tracking

Quantitative Research Techniques Awareness   Image  Brand responses  Brand relationships 9.21

Brand Awareness  Recognition –  Ability of consumers to identify the brand (and its elements) under various circumstances Recall – – Ability of consumers to retrieve the actual brand elements from memory when given some related probe or cue Unaided vs. aided recall 9.22

Awareness   Corrections for guessing – Any research measure must consider the issue of consumers making up responses or guessing. Strategic implications – The advantage of aided recall measures is that they yield insight into how brand knowledge is organized in memory and what kind of cues or reminders may be necessary for consumers to be able to retrieve the brand from memory. – The important point to note is that the category structure that exists in consumers’ minds—as reflected by brand recall performance—can have profound implications for consumer choice and marketing strategy. 9.23

Image  Ask open-ended questions to tap into the strength, favorability, and uniqueness of brand associations.  These associations should be rated on scales for quantitative analysis. 9.24

Brand Responses   Research in psychology suggests that purchase intentions are most likely to be predictive of actual purchase when there is correspondence between the two in the following categories: Purchase Intentions – – – – 25 Action (buying for own use or to give as a gift) Target (specific type of product and brand) Context (in what type of store based on what prices and other conditions) Time (within a week, month, or year)

Brand Relationships    Behavioral loyalty Brand substitutability : Longman and Moran view repeat rate – how many people who bought a particular brand last time would buy it again this time- as the key indicator of brand equity Other brand resonance dimensions – For example, in terms of engagement, measures could explore word-of-mouth behavior, online behavior, and so forth in depth 9.26

 Brand dynamics  Equity engines  Young & Rubicam’s Brand Asset Valuator (BAV) 9.27

Brand Dynamics The Brand Dynamics model adopts a hierarchical approach to determine the strength of relationship a consumer has with a brand. The five levels of the model are:  – – – – – Presence Relevance Performance Advantage Bonding 9.28

Equity engines 29 This model delineates three key dimensions of brand affinity [the emotional and intangible benefits of a brand] as follows:  Authority: The reputation of a brand, whether as a longstanding leader or as a pioneer in innovation  Identification: The closeness customers feel for a brand and how well they feel the brand matches their personal Needs  Approval: The way a brand fits into the wider social matrix and the intangible status it holds for experts and friends

Young & Rubicam’s Brand Asset Valuator (BAV) 30 There are five key components of brand health in BAV   Each pillar is derived from various measures that relate to different aspects of consumers’ brand perceptions and that together trace the progression of a brand’s development. – Differentiation – Energy – Relevance – Esteem – Knowledge

Qualitative Research Techniques 1. Free Association 2. Projective Technique 31 3. Ethnographic and Observational Approaches

Qualitative … “Free Association“ 32 This technique involves free association tasks whereby subjects are asked what comes to mind when they think of the brand without any more specific probe or cue than perhaps the associated product category (e.g. “what does the Rolex name mean to you?” or “Tell me what comes to mind when you think of Rolex watches.”)

Qualitative … “Projective Technique“  33 Uncovering the sources of brand equity requires that consumers’ brand knowledge structures be profiled as accurately and completely as possible. Unfortunately, under certain situations, consumers may feel that it would be socially unacceptable or undesirable to express their true feelings.  Projective techniques are diagnostic tools to uncover the true opinions and feelings of consumers when they are unwilling or otherwise unable to express themselves on these matters.

Qualitative … “Ethnographic and Observational Approaches“  34  Fresh data can be gathered by directly observing relative actors and settings. Consumers can be unobtrusively observed as they shop or as they consume products to capture every shade of their behavior. Marketers such as Procter & Gamble seek consumers’ permission to spend time with them in their homes to see how they actually use and experience products.

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