CBBE model provides guidance as to how brand equity can be measured.

Customer-based brand equity is the differential effect that knowledge about brand has on a customer response to the marketing activities or programs of the brand.

Two basic approaches to measure brand equity:◦ Indirect approach: Assess potential sources of

customer-based brand equity by identifying and tracking customers’ brand knowledge structures.

◦ Direct Approach: By assessing the actual impact of brand knowledge on consumer response to different elements of marketing program.

How to think about brand equity measurement & management?

A brand equity measurement system is a set of research procedures that is designed to provide timely, accurate, and actionable information for marketers so that they can make the best possible tactical decisions in the short run and strategic decisions in the long-run.

Crucial for developing of such a system, one has to understand how brand equity or value gets created.

The brand value chain is a means to trace the value creation process to better understand the financial impact of marketing expenditures & investments.

The brand value chain is a structured approach to assessing the sources and outcomes of brand equity and the manner by which marketing activities create brand value.

It has some basic premises. It assumes that:◦ The brand value creation process begins when the

firm invests in a marketing program targeting actual or potential customers.

◦ The marketing activities associated with the program then affects the customer mindset.

◦ The mindset then results in certain outcomes for the brand in terms of how it performs in the marketplace.

◦ Finally, investment community considers this market performance to arrive at an assessment of shareholder value in general & a value of the brand in particular.

The model also assumes that a number of linking factors intervene between these stages.

These factors determine the extent to which value created at one stage transfers or multiplies to the next stage.

Marketing

Program

Investment

Customer

Mindset

Market

Performance

Shareholder

Value

VALUE

STAGES

- Product

- Communications

- Trade

- Other

- Awareness

- Associations

- Attitudes

- Attachment

- Activity

- Price premiums

- Price elasticities

- Market share

- Expansion success

- Cost savings

- Profitability

- Stock price

- P/E ratio

- Market capitalization

Brand Value Chain

Program

Quality

Marketing

Program

Investment

Customer

Mindset

Market

Performance

Shareholder

ValueVALUE

STAGES

- Product

- Communications

- Trade

- Employee

- Other

- Awareness

- Associations

- Attitudes

- Attachment

- Activity

- Price premiums

- Price elasticities

- Market share

- Expansion success

- Cost structure

- Profitability

- Stock price

- P/E ratio

- Market capitalization

Marketplace

ConditionsMULTIPLIER

- Clarity

- Relevance

- Distinctiveness

- Consistency

- Channel support

- Consumer size & profile

- Competitive reactions

- Market dynamics

- Growth potential

- Risk profile

- Brand contribution

Investor

Sentiment

Implementing this system involves:◦ Conducting brand audits. Brand Inventory

Brand Exploratory

◦ Developing tracking procedures.

◦ Designing a brand equity management system Brand Equity Charters

Brand Equity Reports

Brand Equity Overseers

A brand audit is a comprehensive examination of a brand involving activities to assess the health of the brand, uncover its sources of equity and suggest ways to improve and leverage that equity.

A brand audit requires understanding sources of brand equity from the perspective of both the firm and the consumer.

Specifically, the brand audit consists of two activities:◦ Brand Inventory◦ Brand Exploratory

The purpose of the brand inventory is to provide a complete, up-to-date profile of how all the products and services sold by a company are marketed and branded.

For each product, the relevant brand elements must be identified, as well as the supporting marketing program. This information should be summarized both visually and verbally.

Although primarily a descriptive exercise, some useful analysis can be conducted.

The brand exploratory is research activity designed to identify potential sources of brand equity.

The brand exploratory provides detailed information as to what consumers think of and feel about the brand.

Although reviewing past studies and interviewing relevant personnel provides some insights, additional research is often required.

To allow a broad range of issues to be covered and also permit those issues to be pursued in-depth, qualitative research techniques are often employed first.

To provide a more specific assessment of the sources of brand equity, a follow-up quantitative phase is often necessary.

Tracking studies involve information collected from consumers on a routine basis over time

◦ Often done on a “continuous” basis

◦ Provide descriptive and diagnostic information

◦ Key decisions

What to track – all sources based on CBBE Model

Who to track – current customers/loyal/ loyal to other brands/ nonusers/light or heavy user etc.

When and where to track - frequency

How to interpret tracking studies – level of cut-off: awareness, how positive is the feelings, actual sources of

equity etc.

1. Formalize company position and philosophy into a Brand Equity Charter to provide relevant guidelines to marketing managers.

- Importance of brands and brand equity

- History of brand

- Brand positioning- Core brand values

- Core brand promise (“brand mantra”)

- POP/POD

- Brand guidelines- Strategic

- Tactical

2.Assemble results of tracking survey and other relevant outcome measures into a Brand Equity Report distributed to managers on regular basis

◦ Provides descriptive information as to what is happening with a brand as well as diagnostic information as to why it is happening.

3. Brand Equity Responsibilities: Establish position of VP or Director of Equity Management to oversee implementation of Brand Equity Charter and Reports

◦ Ensure that, as much as possible, marketing of the brand is done in way that reflects the spirit of the Charter and the substance of the Report

Can Submit within one day after the end-term

Can submit through mail to aetigga@gmail.com

Assignment:

Find out any real national or international brand measurement done by any agency for any product/services/b-school category

Study the method of brand equity measurement in terms of◦ qualitative or quantitative techniques/methods used

different factors/parameters and its weightages, scales used, questionnaire used etc.

◦ Advantage or criticism of the methods

FAR BETTER AN APPROXIMATE ANSWER TO THE RIGHT QUESTION, WHICH IS OFTEN VAGUE, THAN AN EXACT ANSWER TO THE WRONG QUESTION, WHICH CAN ALWAYS BE MADE PRECISE.

- JOHN TUKEY, STATISTICIAN

Brand equity

measurement

system

Brand equity

sources

Brand equity

outcomes

Brand equity

measurement

system

Brand equity

sources

Brand equity

outcomes

Research

Procedure

Qualitative

Methods

Quantitative

Methods

Sources…◦ Brand awareness

◦ Brand attitudes

◦ Brand image

◦ Brand attachments

◦ Etc.

Outcomes◦ Price elasticity

◦ Brand choice

◦ Preference

◦ Sales

◦ Share value etc.

Free association◦ What comes in the mind when they think of the brand.

Projective Techniques◦ Uncover the opinions and feelings of consumers

(a) Completion and interpretation task

Incomplete or ambigious stimuli to elicit consumer thoughts and feelings – pictures, cartoons, stories, converstaions etc.

(b)Comparison Tasks

Compare brands to people, countries, animals, activities, fabrics, occupations, cars, magazines, vegetables etc.

Zaltman metaphor Elicitation Technique (ZMET)◦ Consumers have subconscious motives

Word construct – abstartion to capture common ideas, concepts or themes

Brand Personalities◦ Human characteristics or traits

◦ Big Five:

Sincerity (down to earth…)

Excitement (daring, spirited…)

Competence (reliable,…)

Sophisticated (uperclass, charming…)

Ruggedness (outdoorsy and tough)

Experiment Methods◦ Watch the consumers behaviours at their home, work

place etc.

Brand awareness◦ Recognition

◦ Recall

Brand image◦ Beliefs

Strength

Favorability

Uniqueness

◦ Multidimensional scaling (MDS)

Assessing the resulting value in some way

Measurement procedures to assess the effects of brand knowledge structures

Measures that capture market peformance of the brand

Outcomes

measurement

Comparative

methods

Holistic

methods

Comparative methods◦ Brand-based comparative

◦ Marketing based comparative

◦ Conjoint analysis

Holistic methods◦ Residual approaches – based on physical

attributes only

◦ Valuation approaches

Historical perspectives

General approaches

Cost approach

Market approach

Income approach