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1
visit: www.studyMarketing.org
Managing Brand Equity
2
visit: www.studyMarketing.org
Brand equity is
a set of brand assets and
liabilities linked to a brand
3
visit: www.studyMarketing.org
Elements of Brand Equity:
Brand Loyalty
Brand Awareness
Perceived Quality
Brand Associations
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
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
visit: www.studyMarketing.org
Measuring Brand Loyalty
• Purchase Behavior Patterns
• Switching Cost Analysis
• Satisfaction Measurement
7
visit: www.studyMarketing.org
Strategic Value of Brand Loyalty
• Reduce marketing cost
• Trade (channel distribution) leverage
• Attracting new customers
8
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Enhancing
Brand Loyalty
• Treat the customer right
• Stay close to the customer
• Measure/manage customer
satisfaction
• Create switching cost
• Provide extras
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
visit: www.studyMarketing.org
Brand Awareness Hierarchy
Top of Mind
Brand Recall
Brand Recognition
Unaware of Brand
11
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Value of Brand Awareness
• Anchor to which other associations can be
attached
• Familiarity and liking
• Signal of substance/commitment
• Brand to be considered
12
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How to Achieve
Brand Awareness
Be different, memorable
Involve a slogan or jingle
Symbol exposure
Publicity
Event sponsorship
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
visit: www.studyMarketing.org
What
Influences
Perceived
Quality of
Product?
• Performance
• Features
• Conformance with
specifications
• Reliability
• Durability
• Serviceability
• Fit and finish
15
visit: www.studyMarketing.org
What
Influences
Perceived
Quality of
Service?
Appearance
Reliability
Competence
Responsiveness
Empathy
16
visit: www.studyMarketing.org
The Value of Perceived Quality
• Reason-to-Buy
• Differentiate/Position
• A Price Premium
• Channel Member Interest
• Brand Extensions
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
visit: www.studyMarketing.org
Some Types of
Associations
• Product Attributes
• Customer Benefits
• Relative Price
• Lifestyle/Personality
• Celebrity/Person
• Use/Application
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
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
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
visit: www.studyMarketing.org
Brand Management
Developing Brand Vision
Establishing Brand Position
Fulfilling Brand Contract
Communicating Brand Position
Measuring RoBI
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
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
visit: www.studyMarketing.org
END of Slides

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Managing brand equity