1. Brand Measurement

2. Pros and Cons of Brand Measurement Measure the wrong things Evaluate alternative strategies Avoid costly mistakes Increase efficiency in general Disagreement on what to test Research problems Cost of measurement Determine if objectives are achieved Time Advantages Disadvantages

3. Brand Measurement: Marketers’ Views IssueAgree Brand Measurement is a key priority for today’s technology companies. 90% I am dissatisfied with our ability to demonstrate marketing programs’ business impact and value. 80% It is important to define, measure, and take concrete steps in the area of advertising accountability. 61.5% I can forecast the impact on sales of a 10% cut in marketing spending. 37%

4. Essentials of Brand Measurement Use a consumer response model Use benchmark testing Use multiple measures Understand and implement proper research Establish communications objectives Brand Measurement Brand Measurement

5. Two Evaluation & Measurement Strategies Brand Equity – brand assets (or liabilities) linked to a brand’s name and symbol that add to (or subtract from) a product or services* Brand Valuation – Assigning a dollar value to the brand “Brand Leadership”, Aaker and Joachimsthaler

6. Brand Equity Dimensions & Constructs AwarenessPerceived Quality Association/ Differentia- tion LoyaltyMarket Behavior Brand Awareness Perceived Quality Perceived Value Price Premium Market Share LeadershipBrand Personality SatisfactionPrice Indices Organizational Associations Distribution Indices Aakers, David “Measuring Brand Equity Across Products and Markets”

7. Brand Equity Assessment Criteria Tap the full scope of brand equity Focus on sustainable advantages not easily duplicated by competitors Reflect the constructs that truly drive the market; are associated with future sales & profits – Movement on a measure will move price levels, sales or profits Measures should be sensitive – when equity changes the measures reflect those changes Applicable across brands, product categories & markets –Tested proven measures provide structure for developing a set of individual brand measures

8. Brand Awareness The level of brand recognition that consumers have of a particular brand and its specific product category Reflects the salience of the brand Awareness levels –Recognition: Has heard of the brand – Recall: Brands that can be named –Top-of Mind: The first-named brand –Brand Dominance: The only brand recalled –Brand Knowledge: Knowing what the brand stands for –Brand Opinion: A value judgment of the brand

9. Precautions Awareness is not equally important across categories –Recognition is important for new companies –Recall and top-of-mind important to mature categories/companies On its own provides an incomplete picture

10. Perceived Quality Special associations that occur in many contexts; empirically shown to affect ROI Associated with price elasticities and brand usage Associated with specific benefit variables Measured as a scale in comparison to alternative brands –High vs. average vs. inferior –The best vs. one of the best vs. one of the worst vs. the worst –Consistent vs. inconsistent quality “Brand Leadership”, Aaker and Joachimsthaler; Aakers, David “Measuring Brand Equity Across Products and Markets”

11. Precautions Perceived quality involves a competitor frame of reference Need to compare “apples to apples” … sub- compacts vs. luxury brands Segmentation issues … perception varies across customers vs. switchers vs. competitive loyalists It may not be the key driver It may not be sensitive to relevant events

12. Perceived Quality - Leadership Taps into market dynamics above quality Leadership Dimension –The “Number 1” Syndrome –Product Class Innovation Measured by scales –The leading brand, one of the leading brands, not a leading brand –Growing in popularity –Innovative, first with advances

13. Precautions Not a simple construction; reflects market size, popularity & innovation Not as well-researched or documented as other dimensions … loyalty, quality, awareness Therefore, evidence that it is important enough to merit attention is weak Aakers, David “Measuring Brand Equity Across Products and Markets”

14. Brand Associations - Definition Anything that connects individuals to the brand. It can include –User imagery –Product attributes –Organization considerations –Brand personalities –Symbols “Brand Leadership”, Aaker and Joachimsthaler

15. Brand Association - Value Focuses on the brand value proposition Brand value involves –a functional benefit –is usually basic to most brands in its class Brand value can be measured by –Provides good value for the money –Whether there are reasons to buy a brand over competitors

16. Precaution Is brand value different from perceived quality? Perceived quality/price? Brand value may relates more to functional benefits and utility Perceived quality may have a higher association with prestige

17. Association – Brand Personality Defined as “brand-as-a- person” Provides links to emotional and self-expression benefits Especially important where there are minor physical differences Continuum is often product specific –Retail: Energy/Vitality –Telephone companies: friendly/reliable –Men’s products: rugged

18. Precautions Not all product categories or brands have personalities Measurement may distort brand strength of products positioned for functional advantages Personality may be stable and not reflect change sensitivity

19. Association – Organization Association Brand-as-an-organization – NFL, Major League Baseball, PGA Important basis for differentiation – product quality, innovation, credibility Any of these characteristics are candidates for measurement scales

20. Precaution Important in some but not all cases May suffer from a lack of sensitivity

21. Brand Loyalty A consumer’s commitment to repurchase the brand When consumers like/consistently buy a specific brand Creates a barrier to entry Brand equity’s core dimension

22. Measuring Loyalty – Price Premium Price Premium – Amount a customer will pay vis-à-vis competing brands Negative Price premium can be good … Target vs. Macy’s Or what variables influence price A reasonable summary of brand strength Two measurements –Dollar metric … How much are you willing to pay –Conjoint analysis … based a series of choices More sensitive Seeks a “relative price

23. Precautions Defined with respect to only one set of competitors Might miss an emerging competitor or an emerging variable Different competitors/variable in different markets … the Budweiser case Price differentiation is not relevant … legal restrictions, the Japan beer market

24. Brand Loyalty – Customer Satisfaction Measure on multiple dimensions specific to a product or service –Auto: durability, fit & finish –Financial Services: empathy, responsiveness Measured as intent to buy –Would you buy this brand at the next opportunity? –Would you recommend to others?

25. Precautions They do not apply to non-customers Do not measure brand equity beyond the customer base Satisfaction and loyalty become ambiguous when aggregated across customers, brand switchers and other brand loyalists

26. Market Behavior Precautions Market Share –More elements than brand go into market share –Often responsive to short-term strategies Price/Distribution Indices –Different channels –Complex competitive set

27. Where to From Here Develop a set of 4-8 constructs from the five dimension Establish a weighting system to accommodate relative importance Match the weighing system to perceived values of the target market