Description
It defines brands, brand equity, measuring equity methods, dimensions of measurment, awareness of brand, loyalty, perceived quality, associations
BRAND EQUITY AND ITS MEASUREMENT
“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
.
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.
A unique neural network encoding an individual’s knowledge and experience of a product or service ,including the individual’s emotional associations with the brand. The ease of a access, richness and intensity of the network measures the strength and value of that brand to the individual.
Brand Equity is a set of brand
assets and liabilities linked to a brand , its name and symbol 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.
Approaches to measuring Brand Equity/value (a) Inside out approach-From the company angle. Brand Equity as a reflection of: ?Average sales and or profit over a period of time. ?Profit as a % of sales over a period of time and comparing with industry standards.
?Marketing
cost incurred from the time of the brand’s introduction in the market. ?Price premiums which can be charged by a brand in comparison to competitors. (b)Stock market - share holder angle ?Stock price of a single brand firm. ?Market capitalization. ?Market capitalization - Replacement cost (Plant &Equipment, Inventory and cash) = Intangible assets. © Customer based approach- customer as value assessor
Measuring Brand Equity Methods
1. a. b.
Cost based Historical cost method Replacement cost method.
c. Discounting cash flow method. d. Inter brand method.
2. Price based method a. Price premium method. b. Market share equalisation method. c. Price premium at indifference method. 3. Customer based method.
Brand Colgate
Price Mkt. Rev. share 48 30 35 20 5 10 1440 1750 1040 200 420
Equal. Value 20 20 20 20 20 72 88 52 10 21
Value 29 37 21 4.5 9
Pepsode 50 nt Close up 52 Promise 40 Anchor 42
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.
Brand Equity provide value to the customer by enhancing the customer’s : ?Interpretation /Processing of information. ?Confidence in purchase decision. ?Use satisfaction.
Brand Equity provide value to the firm by enhancing: ?Efficiency and effectiveness of marketing programs ?Increasing brand loyalty ?Increasing price and price margins. ?Brand extension. ?Trade leverage.
TOP 10 INDIAN BRANDS 1. Colgate 2. Vicks 3. Lux 4. Nokia 5. Britannia 6. Dettol 7. Lifebuoy 8. Pepsodent 9. Pond’s 10. Tata Tea
A model for measuring Customer based Brand Equity?
Brand awareness
Perceived quality
Brand Equity
Brand Association
Brand Loyalty
Other Proprietary Brand assets
Fig. Brand equity dimensions – model by David Aker
Brand recall
Brand Awareness
Brand recognition Attributes
Non Product related Product related Functional Attitude Experiential Symbolic
Brand Equity/Brand Knowledge
Benefits Brand associations Brand Image Favorability of brand association Strength of brand association
Fig: Dimensions of brand equity/ Brand Knowledge – model of Kevin Lane Keller.
Uniqueness of brand associations
DIMENSIONS OF MEASURING BRAND EQUITY
?BRAND
AWARENESS ?BRAND LOYALTY ?PERCEIVED QUALITY ?BRAND ASSOCIATIONS ?OTHE PROPRIETARY BRAND ASSETS.
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) recall recognition. of the brand.
?Brand ?Brand
?Unaware
Top of the mind
Brand Recall Brand recognition Unaware of brand
Fig. Pyramid of brand awareness
Ricoh. Sony Canon Panasonic Lumix Pentax Philips Polaroid Casio Cobra Hitachi Kodak Kyocera Nikon Rollei Leica
Brand/Dimension 1. Brand Awareness a. Top of the mind (10) b. Unaided recall (7)
Canon
Nikon
Kodak
Polaroid
60 140
10 84
100 140
30 105
c. Aided recall – recognition (4) Unaware Total score
80
80
80
80
280
174
320
215
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 Pepsodent tooth paste. No. of brands purchased- how many other brands were bought during the above period.
?
?
(b) Other measures. ?Finding switching costs.
?Measuring ?Liking
satisfaction.
of the brand.
?Commitment.
Brands Repurchase
Clinic All clear 3 3
Sunsilk Pantene Head & Chik shoulders 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 33 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 33 3 11 11 3 3 3 3 3 3 3 3 3 3 3 3 33 3 11 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 33 3
% of Purchase 3 3 No. of Brands Time Effort Price Satisfaction Liking Commitment TOTAL 3 3 11 3 3 3 3 3 3 3 3 3 3 33 3
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.
Perceived Quality dimensions
?Performance-
Whirlpool semi automatic washing machine washes clothes whitest, rinses and dries clothes quickest. ?Features -The Sony VCR has one knob which has got both rewind and forward function. ?Conformance to specificationsMitsubishi Lancer was voted in India as the car with least defects in 2000.
Reliability - Kelvinator refrigerators are extermely reliable ones. Durability - Ambassador car/baja scooters are known for its durability. Serviceability - easy to service as well as the service system is easily accessible.- bajaj scooters, 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 . Kannan Devan, Mountain mist, Red label, Lipton, Tata tetley, 3 roses . Non stick pan - Prestiege,Hawkins, Nirlep, Nirala .
?Tea-
?
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 elementsslogan,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
Some associationsMaggi- 2 minute Dettol - antisceptic, sword . Little heart biscuit – heart shaped, vaccum filled pack. Pepsi –blue, youth. Onida- devil Santro- Sharukh Khan, Zip drive. Surf- Lalithaji, High quality Toyota- Japan.
How can associations be measured ?
(A) Identify
the most important association (B) ( Projective techniques)
? ? ? ?
Word association Picture interpretation. Sentence completion. Experience sharing
(B) Measuring the intensity of association Measure for : (a) Strength of association (b) Uniqueness of association © Favorability of association.
?(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
.
5. OTHER PROPRIETARY ASSETS David Aker feels that the 3 most important proprietary assets of a brand are: A. Name B. Slogan C. Symbol Measured for ?Attractiveness. ?Fit/effectiveness
BPL- Believe in the best Videocon- The Indian Multinational. LG – Life’s good Samsung- Pioneering the digital path Philips – Let’s make things better Onida - Nothing but the truth. Sansui – Born in Japan. Entertaining the world.
Table 2: Customer-based Brand Equity Scores of a Few Brands of talcum powder
Brand/Dimension 1. Brand Awareness a. Top of the mind b. Unaided recall c. Aided recall 2.Brand Loyalty a. Switching cost b. Liking c. Satisfaction d. Commitment 3.Perceived Quality a. Performance b. Features c. Conformance with specifications d. Reliability e. Durability f. Fit and finish 4. Brand Association a. Strength of association b. Uniqueness of association c. Favourability of association 5.Other Proprietary Assets a. Name b. Logo c. Slogan Total score Cuticura 65 55 45 75 80 70 65 65 70 65 70 65 70 70 60 75 Yardley 60 40 40 55 65 70 80 60 70 70 80 70 60 65 60 65 Ponds 75 60 45 70 75 75 80 70 75 70 65 60 75 80 70 70 Spinz 45 30 25 45 55 45 55 45 50 55 50 45 65 50 45 50
70 70 60 1265
65 50 55 1180
80 75 65 1335
50 35 40 880
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.
doc_918528870.ppt
It defines brands, brand equity, measuring equity methods, dimensions of measurment, awareness of brand, loyalty, perceived quality, associations
BRAND EQUITY AND ITS MEASUREMENT
“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
.
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.
A unique neural network encoding an individual’s knowledge and experience of a product or service ,including the individual’s emotional associations with the brand. The ease of a access, richness and intensity of the network measures the strength and value of that brand to the individual.
Brand Equity is a set of brand
assets and liabilities linked to a brand , its name and symbol 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.
Approaches to measuring Brand Equity/value (a) Inside out approach-From the company angle. Brand Equity as a reflection of: ?Average sales and or profit over a period of time. ?Profit as a % of sales over a period of time and comparing with industry standards.
?Marketing
cost incurred from the time of the brand’s introduction in the market. ?Price premiums which can be charged by a brand in comparison to competitors. (b)Stock market - share holder angle ?Stock price of a single brand firm. ?Market capitalization. ?Market capitalization - Replacement cost (Plant &Equipment, Inventory and cash) = Intangible assets. © Customer based approach- customer as value assessor
Measuring Brand Equity Methods
1. a. b.
Cost based Historical cost method Replacement cost method.
c. Discounting cash flow method. d. Inter brand method.
2. Price based method a. Price premium method. b. Market share equalisation method. c. Price premium at indifference method. 3. Customer based method.
Brand Colgate
Price Mkt. Rev. share 48 30 35 20 5 10 1440 1750 1040 200 420
Equal. Value 20 20 20 20 20 72 88 52 10 21
Value 29 37 21 4.5 9
Pepsode 50 nt Close up 52 Promise 40 Anchor 42
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.
Brand Equity provide value to the customer by enhancing the customer’s : ?Interpretation /Processing of information. ?Confidence in purchase decision. ?Use satisfaction.
Brand Equity provide value to the firm by enhancing: ?Efficiency and effectiveness of marketing programs ?Increasing brand loyalty ?Increasing price and price margins. ?Brand extension. ?Trade leverage.
TOP 10 INDIAN BRANDS 1. Colgate 2. Vicks 3. Lux 4. Nokia 5. Britannia 6. Dettol 7. Lifebuoy 8. Pepsodent 9. Pond’s 10. Tata Tea
A model for measuring Customer based Brand Equity?
Brand awareness
Perceived quality
Brand Equity
Brand Association
Brand Loyalty
Other Proprietary Brand assets
Fig. Brand equity dimensions – model by David Aker
Brand recall
Brand Awareness
Brand recognition Attributes
Non Product related Product related Functional Attitude Experiential Symbolic
Brand Equity/Brand Knowledge
Benefits Brand associations Brand Image Favorability of brand association Strength of brand association
Fig: Dimensions of brand equity/ Brand Knowledge – model of Kevin Lane Keller.
Uniqueness of brand associations
DIMENSIONS OF MEASURING BRAND EQUITY
?BRAND
AWARENESS ?BRAND LOYALTY ?PERCEIVED QUALITY ?BRAND ASSOCIATIONS ?OTHE PROPRIETARY BRAND ASSETS.
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) recall recognition. of the brand.
?Brand ?Brand
?Unaware
Top of the mind
Brand Recall Brand recognition Unaware of brand
Fig. Pyramid of brand awareness
Ricoh. Sony Canon Panasonic Lumix Pentax Philips Polaroid Casio Cobra Hitachi Kodak Kyocera Nikon Rollei Leica
Brand/Dimension 1. Brand Awareness a. Top of the mind (10) b. Unaided recall (7)
Canon
Nikon
Kodak
Polaroid
60 140
10 84
100 140
30 105
c. Aided recall – recognition (4) Unaware Total score
80
80
80
80
280
174
320
215
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 Pepsodent tooth paste. No. of brands purchased- how many other brands were bought during the above period.
?
?
(b) Other measures. ?Finding switching costs.
?Measuring ?Liking
satisfaction.
of the brand.
?Commitment.
Brands Repurchase
Clinic All clear 3 3
Sunsilk Pantene Head & Chik shoulders 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 33 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 33 3 11 11 3 3 3 3 3 3 3 3 3 3 3 3 33 3 11 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 33 3
% of Purchase 3 3 No. of Brands Time Effort Price Satisfaction Liking Commitment TOTAL 3 3 11 3 3 3 3 3 3 3 3 3 3 33 3
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.
Perceived Quality dimensions
?Performance-
Whirlpool semi automatic washing machine washes clothes whitest, rinses and dries clothes quickest. ?Features -The Sony VCR has one knob which has got both rewind and forward function. ?Conformance to specificationsMitsubishi Lancer was voted in India as the car with least defects in 2000.
Reliability - Kelvinator refrigerators are extermely reliable ones. Durability - Ambassador car/baja scooters are known for its durability. Serviceability - easy to service as well as the service system is easily accessible.- bajaj scooters, 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 . Kannan Devan, Mountain mist, Red label, Lipton, Tata tetley, 3 roses . Non stick pan - Prestiege,Hawkins, Nirlep, Nirala .
?Tea-
?
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 elementsslogan,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
Some associationsMaggi- 2 minute Dettol - antisceptic, sword . Little heart biscuit – heart shaped, vaccum filled pack. Pepsi –blue, youth. Onida- devil Santro- Sharukh Khan, Zip drive. Surf- Lalithaji, High quality Toyota- Japan.
How can associations be measured ?
(A) Identify
the most important association (B) ( Projective techniques)
? ? ? ?
Word association Picture interpretation. Sentence completion. Experience sharing
(B) Measuring the intensity of association Measure for : (a) Strength of association (b) Uniqueness of association © Favorability of association.
?(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
.
5. OTHER PROPRIETARY ASSETS David Aker feels that the 3 most important proprietary assets of a brand are: A. Name B. Slogan C. Symbol Measured for ?Attractiveness. ?Fit/effectiveness
BPL- Believe in the best Videocon- The Indian Multinational. LG – Life’s good Samsung- Pioneering the digital path Philips – Let’s make things better Onida - Nothing but the truth. Sansui – Born in Japan. Entertaining the world.
Table 2: Customer-based Brand Equity Scores of a Few Brands of talcum powder
Brand/Dimension 1. Brand Awareness a. Top of the mind b. Unaided recall c. Aided recall 2.Brand Loyalty a. Switching cost b. Liking c. Satisfaction d. Commitment 3.Perceived Quality a. Performance b. Features c. Conformance with specifications d. Reliability e. Durability f. Fit and finish 4. Brand Association a. Strength of association b. Uniqueness of association c. Favourability of association 5.Other Proprietary Assets a. Name b. Logo c. Slogan Total score Cuticura 65 55 45 75 80 70 65 65 70 65 70 65 70 70 60 75 Yardley 60 40 40 55 65 70 80 60 70 70 80 70 60 65 60 65 Ponds 75 60 45 70 75 75 80 70 75 70 65 60 75 80 70 70 Spinz 45 30 25 45 55 45 55 45 50 55 50 45 65 50 45 50
70 70 60 1265
65 50 55 1180
80 75 65 1335
50 35 40 880
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.
doc_918528870.ppt