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BRAND EQUITY ITS MEASUREMENT AND DEVELOPING STRATEGIES
“A brand that captures your mind gains behavior. A brand that captures your heart gains commitment.” - Scott Talgo, Brand Strategist
“Brand equity is the sum of all the hearts and minds of every single person that comes into contact with your brand." - Christopher Betzter, Brand Strategist
.
Best Global brands – Inter brand- 2012 Ranking Brand Name Brand value in $ million % change from previous
year
1 Coca Cola 77,839 + 8
2 Apple 76,568 +129
3 IBM 75,532 +8
4 Google 69,726 +26%
5 Micro soft 57,853 -2
6 GE 43,682 +2
7 McDonald’s 40,062 +13
8 Intel 39,385 +12
9 Samsung 32,893 +40
10 Toyota 30,280 +9
11 Mercedez-Bensz 30,97 +10
12 BMW 29,092 +18
13 Disney 27,438 -5
14 Cisco 27,197 +7
15 HP 26,087 -8
Best Brands in India Position 2008 2009 2010 2011 2012
1 Nokia Nokia Nokia Colgate Colgate
2 Colgate Colgate Colgate Lux Brittania
3 Tata Salt Lux Lux Airtel Nokia
4 Pepsodent Lifebuoy Dettol Lifebouy Clinic Plus
5 Pond’s Dettol Britannia Nokia Dettol
6 Lux Horlicks Lifebuoy Dettol Tata Salt
7 Britannia Tata Salt Clinic Plus Brittania Parle
8 Dettol Pepsodent Pond’s Vodafone Mazza
9 Lifebuoy Britannia Fair & Lovely Maggi Maggi
10 Vicks Reliance Mobile
Pepsodent Close up Lifebouy
Which shirt brand has greater Brand Value/ Equity?
Brand Equity
• What is it?• How do we measure it?• Using the above, How will we
develop brand strategies /plans?
What is a brand?
A brand is a distinguishing name and /or symbol such as logo, trade mark or package design, intended to identify the goods or services of one seller and to differentiate those goods or services from those of competitors.
What is brand equity ? Meaning.
Brand Equity is a set of brand assets and liabilities linked to a brand through various elements of the product/brand, that add or subtract from the value provided by a product or service to the firm’s customers.
Brand Equity, simply, means - the value of the brand.
Hence , Brand equity means the difference in value perceived while the name of an established brand is mentioned against an unnamed /fictitiously named product to the customer or potential customer.
Eg. The difference that is perceived by a house wife at the mention of
• a pressure cooker • Hawkins pressure cooker.
Hence Measuring Brand EquityMethods are:
1. Cost based - historical, replacement.
2. Price based - Price premium.
3. Customer based method
Prices of Paints Asian paints – Rs. 280. 1tr – 27%Nerolac- Rs.274- 13%Berger – Rs. 266- 11%J&N- Rs.260- 3%Shalimar – Rs. 256- 2 %Others- Rs. 246 -12%- Unorganized – Rs.228- 11%
Customer based brand equity involves the consumer’s reaction to an
element of the marketing mix for the brand in comparison with their reactions to the same marketing mix attributed to a fictitiously named or unnamed version of the product or service.
Customer-Based Brand Equity PyramidCustomer-Based Brand Equity Pyramid
RESONANCE
SALIENCE
JUDGMENTS FEELINGS
PERFORMANCE IMAGERY
4. RELATIONSHIPS =
What about you and me?
4. RELATIONSHIPS =
What about you and me?
3. RESPONSE =
What about you?
3. RESPONSE =
What about you?
2. MEANING =
What are you?
2. MEANING =
What are you?
1. IDENTITY =
Who are you?
1. IDENTITY =
Who are you?
Customer-Based Brand Equity ModelCustomer-Based Brand Equity Model
Consumer-BrandResonance
Brand Salience
Consumer Judgments
Consumer Feelings
BrandPerformance
BrandImagery
INTENSE, ACTIVE LOYALTYINTENSE, ACTIVE LOYALTY
RATIONAL & EMOTIONAL REACTIONS
RATIONAL & EMOTIONAL REACTIONS
POINTS-OF-PARITY & POINTS-OF-DIFFERENCE
POINTS-OF-PARITY & POINTS-OF-DIFFERENCE
DEEP, BROAD BRAND
AWARENESS
DEEP, BROAD BRAND
AWARENESS
A model for measuring Customer based Brand Equity?
Brand Awareness
Brand Equity/BrandKnowledge
Brand recognition Non Product
related
AttributesProduct related
BenefitsFunctional
Experiential
Symbolic
Brand associations
Favorabilityof brand association
Strength of brand association
Uniqueness of brand associations
Brand Image
Brand recall
Attitude
Fig: Dimensions of brand equity/ Brand Knowledge – model of Kevin Lane Keller.
Brandawareness
Perceived quality
BrandLoyalty
BrandAssociation
OtherProprietary
Brand assets
BrandEquity
Fig. Brand equity dimensions – model by David Aker
DIMENSIONS OF MEASURING BRAND EQUITY
• BRAND LOYALTY• BRAND AWARENESS• PERCEIVED QUALITY• BRAND ASSOCIATIONS• OTHER PROPRIETARY BRAND ASSETS.
1. BRAND AWARENESS
1. BRAND AWARENESS
Awareness refers to the strength of a brand’s presence in the consumer’s mind.
Brand awareness is the ability of the potential buyer to recognize or recall that a brand is a member of a certain product category.
Levels of brand awareness
• Top Of the Mind (TOM)
• Brand recall
• Brand recognition.
• Unaware of the brand.
Top of the
mind
Brand Recall
Brandrecognition
Unaware of brand
Fig. Pyramid of brand awareness
Ricoh.SonyCanonPanasonicLumixPentaxPolaroidCobraHitachiKodakKyoceraNikonRolleiLeica
Brand/Dimension Canon Nikon Kodak Polaroid
1. Brand Awarenessa. Top of the mind 60 40 75 35
b. Unaided recall 55 40 60 30
c. Aided recall - recognition
45 40 45 25
Total score 160 120 180 90
How does Brand Awareness help the firm?
• Anchor to which other associations can be attached.
• Creates familiarity and then liking.• Creates some amount of commitment.• Possibility of placing the brand in the
consideration set for purchase.
2.BRAND LOYALTY
2.BRAND LOYALTY
It is the tendency of the customer to buy the same brand again and again, by asking by its brand name.
5 levels of loyalty
• Price sensitive,no brand loyalty• Switchers/habitual buyers.• Satisfied buyers- switching cost.• Likes the brand.• Commitment.
Committed buyers
Likes the brand/ considers it as a
friend
Satisfied buyer with switching costs
Reasonably Satisfied/Habitual buyer
Searching for reasons to change
Heavy Switchers/price sensitive/ indifferent – No brand loyalty
Fig. Pyramid of brand loyalty.
Measuring Brand loyalty(a) Behaviour measures
• Repurchase rate frequency of purchase over a period.
• % of purchase-what % of all the brand bought over a period was Brand -X.
• No. of brands purchased- how many other brands were bought during the above period.
(b) Other measures.• Finding switching costs- price, efforts and
time.
• Measuring satisfaction.
• Liking of the brand.
• Commitment.
Brands Clinic All clear
Sunsilk Pantene Head & shoulders
Chik
Repurchase 35 21 25 17 20
% of Purchase 25 21 23 16 15
No. of Brands 21 16 16 12 12
Time 28 10 20 8 10
Effort 25 15 20 7 8
Price 40 28 30 20 21
Satisfaction 91 60 80 45 42
Liking 92 80 90 60 22
Commitment 60 50 55 30 28
TOTAL
417
281
359
215
168
How does brand loyalty help the firm?
• Reduce Marketing cost.
• Trade leverage-bargaining power.
• Attracting new customers- easy awareness creation and reassurance to new customers.
• Gives time to respond to competitive threats.
3. PERCEIVED QUALITY
Perceived quality can be defined as the customer’s perception of the overall quality or superiority of a product or service with respect to its intended purpose relative to alternatives.
Dimensions- Performance, Features Conformance to specifications, Reliability Durability, Serviceability, Fit and finish
Perceived Quality dimensions
• Performance- LG semi automatic washing machine washes clothes whitest, rinses and dries clothes quickest.
• Features ( special) - 2 cameras. The camera on the back of the phone shoots 5-megapxzel still images and takes 720p HD video .
• Conformance to specifications- Mitsubishi Lancer was voted in India as the car with least defects.
Reliability – Sony TVs are highly reliable.
Durability - Ambassador cars/Usha fans are known for its durability.
Serviceability - easy to service as well as the service system is easily accessible.- V – guard stabilizers , Maruti car.
Fit and finish - Lady bird is a sleek lady’s bicycle.
How will you measure Perceived Quality for the below given brands ?
• Fans - Polar, Khaitan, Usha, Orient, Padmini, Crompton Greaves .
• Tea- Kannan Devan, Mountain mist, Red label, Lipton, Tata tetley, 3 roses c.
• Non stick pan - Prestiege,Hawkins, Nirlep, Nirala .
Brand/Dimension
Hawkins Prestiege Nirlep Nirala
3.Perceived Qualitya. Performance 65 70 45 35
b. Features 75 70 60 50
c. Conformance with specifications
65 70 55 45
d. Reliability 70 80 65 50
e. Durability 60 70 75 45
f. Fit and finish 75 60 55 60
total 410 420 355 285
Perceived Quality Scores of a Few Brands of pressure cooker
4. BRAND ASSOCIATION
Association (s) of a brand is/are ‘things’ elements/ factors/ events/ people, with which the brand is associated most.
Associations of the brand can be most with • Benefits• Attributes• Package• Accessories• Other brand elements- slogan,symbol,
brand character,after sales service, guarantee etc.
There can be other secondary associations like
• customers• celebrity/personality• Price• Company• Country of origin.• Product class
How can associations be measured ?
(A) Identify the most important association
Qualitative - Projective techniques • Word association• Picture interpretation.• Sentence completion.• Experience sharing
Some associations-Maggi- 2 minuteDettol - antisceptic, sword .Little heart biscuit – heart shaped, vaccum
filled pack. Pepsi –blue, youth.Onida- devilSantro- Sharukh Khan, Zip drive.Surf- Lalithaji, High qualityToyota- Japan.
(B) Measuring the intensity of associationMeasure for :
(a) Strength of association (b) Uniqueness of association © Favorability of association.
Air India – Public sector, largest destinations.
Jet airways- service quality, easy availability
Spice jet - Sun group, Chennai based. Indigo- Punctual, profit making.
Brand/Dimension
Air India Indigo Jet Spice jet
4. Brand Association a. Strength of association
70 75 80 50
b. Uniqueness of association
70 65 70 45
c. Favourability of association
45 80 75 50
Brand Association Scores
(C) Humanizing the brand – Profiling the personality of the brand.
Brand personality describes the brand as a human being in terms of:
Physical characteristics• Demographic characteristics.• Personality traits
.
Brand personality study on Eveready brought out the following (2000)
Brand personality of Eveready . If it were to be a human being, it will be:
• Male • Age -25-28• Upper middle class• well built person.• About 5 ft 10 ” tall• Born in a semi urban place.• Graduate.
• 1-2 years into job.• Salary- 15,000-20,000.• Staying in a big town or city• Proud possessor of a bike, sunglass, and
body building equipments. • Hardworking • Loves to travel.• Occasional drinker
• Confides with a couple of close friends • Not very extrovert • Loves sports- loves to play them than
watching.
Association best with celebrity-Sunil Shetty.
Wipro’s Santoor ‘sfairness cream
Brandscan 2005 56
User Imagery Brand Personality
Rural Urban
Dishonest Honest
Cowardly Daring
Boring Imaginative
Unreliable Reliable
Lethargic Energetic
Introvert Extrovert
Traditional Modern
Conventional Tech Savvy
Impractical Practical
Unsuccessful Successful
Stupid Intelligent
Tough Tender
Sad Cheerful
Dull Charming
Psychographic Imagery
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
1 2 3 4 5 6 7
5. OTHER PROPRIETARY ASSETS
David Aker feels that the 3 most important proprietary assets of a brand are:
A. NameB. SloganC. Symbol
Measured for• Attractiveness.• Fit/effectiveness
VideoconLG Samsung-Philips – Onida - Sansui –Sony-
Videocon- The Indian Multinational.LG – Life’s goodSamsung- Pioneering the digital pathPhilips – Let’s make things betterOnida - Nothing but the truth.Sansui – Born in Japan. Entertaining the
world.Sony- Make . Believe
Brand/Dimension LG Samsung Onida Philips
5.Other Proprietary Assetsa. Name
70 65 75 90
b. Logo 70 45 45 80
c. Slogan 60 35 40 85
total 200 145 160 255
Other Proprietary Assets Scores of a Few Brands of TVs
Brand/Dimension Berger Nerolac Asian paints Shalimar1. Brand Awarenessa. Top of the mind 65 55 75 45b. Unaided recall 55 40 60 30c. Aided recall 45 40 45 252.Brand Loyaltya. Switching cost 75 45 70 45b. Liking 80 65 75 55c. Satisfaction 70 70 75 45d. Commitment 65 55 80 553.Perceived Qualitya. Performance 65 75 70 45b. Features 70 70 75 50c. Conformance with specifications
65 70 70 55
d. Reliability 70 80 65 50e. Durability 65 70 60 45f. Fit and finish 70 60 75 654. Brand Association a. Strength of association
70 55 80 50
b. Uniqueness of association
60 60 70 45
c. Favourability of association
75 55 70 50
5.Other Proprietary Assetsa. Name 70 75 80 50b. Logo 70 50 75 35c. Slogan 60 55 65 40Total score 1265 1145 1335 880
Note: All the dimensions except aided and unaided recall are allotted a maximum of 100 points. Unaided is allotted 70 points while aided recall is allotted 50 points. The detailed explanation regarding the computation of the points for each brand for its brand equity is beyond the scope of this study.
Customer-based Brand Equity Scores of a few Paint Brands
How does brands with high Brand Equity help the firm/company?
• Efficiency and effectiveness of marketing programs
• Increasing brand loyalty • Increasing price and price margins.• Opportunities for Brand extension.• Trade leverage.
Provide value to the customer by enhancing the customer’s :
• Interpretation /Processing of information.• Confidence in purchase decision.• Use satisfaction.
MEASURING BRAND EQUITY
Management Objective : How should the brand value be increased?
Research Objective : To measure Customer based brand equity .
Construct : Customer based Brand equity .
Constitutive definition :Customer based brand equity involves the consumer’s reaction to an element of the marketing mix for the brand in comparison with their reactions to the same marketing mix attributed to a fictitiously named or unnamed version of the product or service.
Brandawareness
Perceived quality
BrandLoyalty
BrandAssociation
OtherProprietary
Brand assets
BrandEquity
Brand equity dimensions – model by David Aker
CONCEPTUAL MODEL
Operational definition: Customer based brand equity involves measuring ( both qualitatively and quantitatively) the dimensions of brand loyalty, brand awareness, perceived quality, brand associations and other proprietary brand assets.
Information required:Specific measurable variables under: 1.Brand awareness
• TOM• Recall• Recognition• Unaware
Information required:Specific measurable variables under: 2. Brand loyalty• Frequency, % of purchase and no. of other brands tried.• Switching cost – time ,effort, price• Liking• Satisfaction• Commitment
Information required:Specific measurable variables under: 3. Perceived quality.• Performance• Features • Conformance to specifications• Reliability • Durability• Serviceability• Fit and finish
Information required:Specific measurable variables under: 4. Brand associations • Strength of Association• Uniqueness of Association• Favorability of association • Brand Personality- Physical, Demographic and Life style
related.
Information required:Specific measurable variables under: 5. Other proprietary brand assets.
• Name Attractiveness• Logo Effectiveness• Slogan
