1Brand Value chain- Designing Brand Tracking studies, Establishing
brand Equity Management.
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Brand Value chain
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.
Some observers believe that up to 70% (or even more) of marketing
expenditures may be devoted to programs and activities that cannot
be linked to short-term incremental profits, but yet can be seen as
improving brand equity.
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It recognizes that many different people within an org’n can affect
brand equity and need to be aware of relevant branding effect. The
brand value chain thus provides insights to support brand managers
chief marketing officers, managing directors and chief executive
officer all the whom may need different types of information.
Virtually every marketing dollar spent today must be justified as
both effective and efficient in terms of “return of marketing
investment” (ROMI).
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Marketing program investment : any marketing program investment
that can contribute to brand value development intentionally or not
falls into this first value stage many marketing activities like
product research development & design, trade or intermediary
support marketing communication including advertising promotion
sponsorship direct and interactive marketing , personal selling
publicity and public relations and employee training.
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Program quality multiplier : the ability of the marketing program
to affect the customer mind-set will depend on its quality.
Clarity: how understandable is the brand marketing program ?do
properly interpret and evaluate its meaning?
relevance :how meaningful is the marketing program to customers ?
Do consumer feel the brand is one they should seriously
consider
Distinctiveness : how unique is the marketing program ? How
creative or differentiating is it?
Consistency : how cohesive and well integrated is the marketing
program ? Do all aspects combine to create the biggest impact with
customer ?
A well-integrated marketing program carefully designed and
implemented to be highly relevant and unique, is likely to achieve
a greater return on investment form marketing program
expenditures
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2. Customer Mind-set: in what ways have customer been changed as a
result of the marketing program ?
The customer mind-set includes everything that exists in the minds
of customers with respect to a brand. Thoughts, feeling experiences
images perceptions beliefs and attitudes, understanding customer
mind-set can have important implication for the marketing
programs.
Five dimensions have emerged form prior research as to measures of
the customer mind-set.
Brand awareness
Brand associations
Brand attitudes
Brand attachment
Brand activity
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Marketplace conditions multiplier: the extent to which value
created in the minds of customers affects market performance
depends on factors beyond the individual customer three such
factors are:
Competitive superiority : how effective are the marketing
investments of competing brands?
Channel and other intermediary support:
Customer size and profile:
The value created in the minds of customer will translate to
favorable market performance when competitors fail to provide a
significant threat when channel members and other intermediaries
provide strong support and when a sizable number of profitable
customers are attracted to the brand.
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3. Market performance : how customers react in the marketplace in
six main ways:
Price premiums
Price elasticity
Market share
Expansion success
Cost structure
Profitability
The first two related to price premiums and price elasticities. How
much extra are customers willing to pay for a comparable product
because of its brand? And how much does their demand increase or
decrease when the price rises or falls?
A third outcome is market share which measures the success of the
marketing program in driving brand sales.
The fourth outcome is brand expansion the success of the brand in
supporting line & category extensions and new-product launches
into related categories, this dimension captures the brand’s
ability to add enhancement to the revenue stream.
The ability of the brand value created at this stage to reach the
final stage in terms of stock market valuation again depends on
external factors.
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Investor sentiment Multiplier: financial analysts and investors
consider a host of factors in arriving at their brand valuations
and investment decision
Market dynamics
Growth potential
Risk profile
Brand contribution
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4. Shareholder value: based on all available current and forecasted
information about a brand, as well as many other considerations,
the financial marketplace formulates opinions and assessments that
have very direct financial implications for the brand value, three
particularly important indicators are the stock price, the price /
earnings multiple, and overall market capitalization for the firm,
research ahs shown that not only can strong brands deliver greater
returns to stockholders they can do so with less risk.
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It provide in-depth information and insights essential for setting
long-term strategic direction for the brand. But to gather
information for short-term tactical decisions, marketers will
collect less detailed brand-related information through ongoing
tracking studies.
Tracking studies collect information form consumers on a routine
basis over time, typically through quantitative measures of brand
performance on a number of key dimensions marketers can identify in
the brand audit or other means, they apply the brand value chain to
understanding where, how much, an din what ways brand value is
being created, thus offering invaluable information about how well
the brand has achieved its positioning.
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Tracking studies involve information collected from consumers on a
routine basis over time.
Often done on a “continuous” basis
Provide descriptive and diagnostic information
Moving form general to more specific measures is also a good idea
in brand tracking surveys to measure brand image, especially
specific perceptions like what consumers think characterizes the
brand & evaluations such as what the brand means to
consumers
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1. What to Track
Customize tracking surveys to address the specific issues faced by
the brand.
It involves 3
Product-brand tracking: tracking an individual branded product
requires measuring brand awareness and image, using both recall and
recognition measures and moving from more general to more specific
questions
Corporate or family brand tracking: when marketers may also want to
track the corporate or family brand separately or concurrently or
both with individual products.
Global tracking: if your tracking covers diverse geographic markets
– especially in both developing and developed countries then you
may need a broader se of background measures to put the brand
developments in those markets in the right perspective.
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It involves 3
Whom to track (target market): tracking often concentrates on
current customers, but it can also be rewarding to monitor nonusers
of the brand or even of the product category as a whole.
When and where to track (how frequently)
How to interpret brand tracking: which elements of the brand should
you use in tracking studies? Marketers use the brand name, but it
may also make sense to use a logo or symbol in probing brand
structures if these elements can play a visible and important role
in the decision process.
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Establishing of Brand Equity Measurement System
A brand equity measurement system is a set of organizational
processes designed to improve the understanding and use of the
brand equity concept within a firm:
Brand equity charter
Brand equity report
Brand equity responsibilities
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.
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1. Brand Equity Charter
Provides general guidelines to marketing managers within the
company as well as key marketing partners outside the company &
Should be updated annually
the first step in establishing a brand equity management system is
to formalize the company view of brand equity into a document, the
brand equity charter, that provides relevant guidelines to
marketing managers within the company as well as key marketing
partners outside the company such as ad agency staff.
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Describe the scope of the key brands.
Specify actual and desired equity for the brand.
Explain how brand equity is measured.
Suggest how brand equity should be measured.
Outline how marketing programs should be devised
Specify the proper treatment for the brand in terms of trademark
usage, packaging, and communication
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2. Brand Equity Report
Assembles the results of the tracking survey and other relevant
performance measures.
To be developed monthly, quarterly, or annually.
Provides descriptive information as to what is happening with the
brand as well as diagnostic information on why it is
happening.
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Brand equity report: the second step in establishing a successful
brand equity management system is to assemble the results of the
tracking surveys and other relevant performance measures for the
brand into a brand equity report or scorecard to be distributed to
management on a regular basis.
The brand equity report should describe what is happening with the
brand as well as why it is happening, if should include all
relevant internal & external measures of brand performance and
sources and outcomes of brand equity.
Organizational Design & Structures: the firm should organize
its marketing function to optimize brand equity, several trends
have emerged in organizational design and structure that reflect
the growing recognition of the importance of the brand and the
challenges of managing brand equity carefully.
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3.Brand Equity Responsibilities
Organizational responsibilities and processes that aim to maximize
long-term brand equity
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
a way that reflects the spirit of the charter and the substance of
the report
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Conducting the Brand Audit
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
Brand Inventory
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.
Consistency
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.
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Brand Equity Charters
Brand Equity Reports
Brand Equity Overseers
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