Managing brand equity
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The document discusses key aspects of brand equity and managing brands, including definitions of brand loyalty, brand awareness, perceived quality, and brand associations. It outlines methods for measuring, enhancing, and communicating different elements of brand equity. Specific strategies are provided for developing a brand vision and positioning, fulfilling a brand's contract with customers, and measuring return on brand investment through various metrics.
Managing brand equity
- 2. 2 visit: www.studyMarketing.org Brand equity is a set of brand assets and liabilities linked to a brand
- 3. 3 visit: www.studyMarketing.org Elements of Brand Equity: Brand Loyalty Brand Awareness Perceived Quality Brand Associations
- 4. 4 visit: www.studyMarketing.org Brand Loyalty Brand loyalty is a measure of the attachment that a customer has to a brand. It reflects how likely a customer will be to switch to another brand, especially when that brand makes a change, either in price or in product features.
- 5. 5 visit: www.studyMarketing.org Brand Loyalty Pyramid Committed Buyer Likes the Brand - Considers it a Friend Satisfied Buyer With Switching Costs Habitual Buyer - No Reason to Change Indifferent – No Brand Loyalty Switchers / Price Sensitive
- 6. 6 visit: www.studyMarketing.org Measuring Brand Loyalty • Purchase Behavior Patterns • Switching Cost Analysis • Satisfaction Measurement
- 7. 7 visit: www.studyMarketing.org Strategic Value of Brand Loyalty • Reduce marketing cost • Trade (channel distribution) leverage • Attracting new customers
- 8. 8 visit: www.studyMarketing.org Enhancing Brand Loyalty • Treat the customer right • Stay close to the customer • Measure/manage customer satisfaction • Create switching cost • Provide extras
- 9. 9 visit: www.studyMarketing.org Brand Awareness is the ability of a potential buyer to recognize or recall that a brand is a member of a certain product category
- 10. 10 visit: www.studyMarketing.org Brand Awareness Hierarchy Top of Mind Brand Recall Brand Recognition Unaware of Brand
- 11. 11 visit: www.studyMarketing.org Value of Brand Awareness • Anchor to which other associations can be attached • Familiarity and liking • Signal of substance/commitment • Brand to be considered
- 12. 12 visit: www.studyMarketing.org How to Achieve Brand Awareness Be different, memorable Involve a slogan or jingle Symbol exposure Publicity Event sponsorship
- 13. 13 visit: www.studyMarketing.org 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 is a perception by customers. Perceived Quality
- 14. 14 visit: www.studyMarketing.org What Influences Perceived Quality of Product? • Performance • Features • Conformance with specifications • Reliability • Durability • Serviceability • Fit and finish
- 16. 16 visit: www.studyMarketing.org The Value of Perceived Quality • Reason-to-Buy • Differentiate/Position • A Price Premium • Channel Member Interest • Brand Extensions
- 17. 17 visit: www.studyMarketing.org Brand Association A brand association is anything "linked" in memory to a brand. Thus, McDonald's could be linked to a character such as Ronald McDonald, a consumer segment such as kids, a feeling such as having fun, a product characteristic such as service, or a symbol such as the Golden Arches.
- 18. 18 visit: www.studyMarketing.org Some Types of Associations • Product Attributes • Customer Benefits • Relative Price • Lifestyle/Personality • Celebrity/Person • Use/Application
- 19. 19 visit: www.studyMarketing.org The Value of Brand Associations • Help Process/Retrieve Information • Differentiate/Position • Reason-to-Buy • Create Positive Attitudes/Feelings • Basis for Extensions
- 20. 20 visit: www.studyMarketing.org Maintaining Associations • Be consistent over time • Be consistent over elements of the marketing program • Manage disasters in order to minimize their damage
- 21. 21 visit: www.studyMarketing.org Criteria for Brand Name Selection • Be easy to learn and remember • Suggest the product class • Support a symbol or slogan • Suggest desired association without being boring or trivial • Not suggest undesired associations • Be distinctive • Be available and protectable legally
- 22. 22 visit: www.studyMarketing.org Brand Management Developing Brand Vision Establishing Brand Position Fulfilling Brand Contract Communicating Brand Position Measuring RoBI
- 23. 23 visit: www.studyMarketing.org Brand Vision A clear articulation of the strategic, financial, and brand goals that management has created for the brand A first step to strategic screens as to where the brand can and cannot go
- 24. 24 visit: www.studyMarketing.org Brand Vision Provides a vision that forces management to articulate what they want the brand to "do" for the organization over the next five years, relative to brand value, revenue, and profit contributions
- 25. 25 visit: www.studyMarketing.org A brand's positioning is the place in consumers' minds that you want your brand to own—the benefit you want them to think of when they think of your brand.
- 26. 26 visit: www.studyMarketing.org A strong brand position means the brand has a unique, credible, sustainable, and valued place in customers' minds. Good positioning gives you the direction required to focus the organization and focus your strategic efforts.
- 27. 27 visit: www.studyMarketing.org A good positioning is a single idea to be communicated to your customers. It revolves around a benefit that helps your product or service stand apart from the competition.
- 28. 28 visit: www.studyMarketing.org Disney Wal – Mart Fedex McDonalds Apple Google Toyota Family Fun Entertainment Low Prices and Good Values Guaranteed Overnight Delivery Food and Fun Innovation Simplicity Reliability
- 29. 29 visit: www.studyMarketing.org A well-crafted brand positioning has three primary components: • A definition of the target market you wish to pursue • A definition of the business your company is in or the industry or category it competes in • A statement of your point of difference and key benefits
- 30. 30 visit: www.studyMarketing.org The Five Principles of Effective Positioning Fit : Seek to leverage strengths of existing brand position Value : Focus on the perceived benefits that customers value, as determined by the customer model Uniqueness : Go where the competitors are not.
- 31. 31 visit: www.studyMarketing.org The Five Principles of Effective Positioning Sustainability : Maximize the length of time this positioning can be owned within the competitive set Credibility : Get a credible fit between who you are and the supplier predicated by the customer model.
- 32. 32 visit: www.studyMarketing.org A Brand Contract is a list of all promises the brand makes to customers. Such a contract is executed internally, but it is defined and validated externally by the marketplace.
- 33. 33 visit: www.studyMarketing.org Brand Contracts can and should change over time. New promises can be added, other promises can be updated, and irrelevant promises can be deleted.
- 34. 34 visit: www.studyMarketing.org A Brand Contract is a critical piece of the brand position because it helps to further define marketplace perceptions and expectations and forces managers to be honest with themselves.
- 35. 35 visit: www.studyMarketing.org In addition to positive promises to customers, a Brand Contract can contain negative promises or attributes. It is important to build on the strong brand promises and mitigate the negative ones.
- 36. 36 visit: www.studyMarketing.org Starbucks' Implicit Brand Contract • Provide the highest quality coffee available on the market today • Offer customers a wide variety of coffee options as well as com- plementary food and beverage items • Have an atmosphere that is warm, friendly, homelike, and appropriate for having a conversation with a good friend or reading a book • Recognize that visiting Starbucks is as much about the experience of drinking coffee as it is about the coffee itself
- 37. 37 visit: www.studyMarketing.org Successful Brand-Based Communications • Use all communication strategies to help achieve your corporate strategy and brand vision. • Let your brand positioning largely determine the right communications strategy to execute. • Use an integrated marketing communications strategy to get maximum return from all dollar investments.
- 38. 38 visit: www.studyMarketing.org Some Metrics to Measure Return on Brand Investment: • Brand name knowledge, awareness, recognition, recall: measures strength of the brand as reflected by customer's ability to identify the brand under varying conditions • Contract fulfillment: measures the degree to which your brand is upholding its Brand Contract
- 39. 39 visit: www.studyMarketing.org Some Metrics to Measure Return on Brand Investment: • Acquired customers: counts customers claiming they have come to your company based on the strength of the brand • Customer loyalty: measures the degree to which customers continue to purchase your brand and how long that loyalty has lasted
- 40. 40 visit: www.studyMarketing.org • Financial value: reports the financial value of your brand in the marketplace • Price premium: finds the percentage of price premium your brand is able to command over private-label brands, as well as key competitor brands Some Metrics to Measure Return on Brand Investment:
- 41. 41 visit: www.studyMarketing.org END of Slides