Managing Brand Equity

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Brand equity is a set of brand assets and liabilities linked to a brand

Elements of Brand Equity: Brand Loyalty Brand Awareness Perceived Quality Brand Associations

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.

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

Measuring Brand Loyalty Purchase Behavior Patterns Switching Cost Analysis Satisfaction Measurement

Purchase Behavior Patterns

Switching Cost Analysis

Satisfaction Measurement

Strategic Value of Brand Loyalty Reduce marketing cost Trade (channel distribution) leverage Attracting new customers

Reduce marketing cost

Trade (channel distribution) leverage

Attracting new customers

Enhancing Brand Loyalty Treat the customer right Stay close to the customer Measure/manage customer satisfaction Create switching cost Provide extras

Treat the customer right

Stay close to the customer

Measure/manage customer satisfaction

Create switching cost

Provide extras

Brand Awareness is the ability of a potential buyer to recognize or recall that a brand is a member of a certain product category

Brand Awareness Hierarchy Top of Mind Brand Recall Brand Recognition Unaware of Brand

Value of Brand Awareness Anchor to which other associations can be attached Familiarity and liking Signal of substance/commitment Brand to be considered

Anchor to which other associations can be attached

Familiarity and liking

Signal of substance/commitment

Brand to be considered

How to Achieve Brand Awareness Be different, memorable Involve a slogan or jingle Symbol exposure Publicity Event sponsorship

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

What Influences Perceived Quality of Product ? Performance Features Conformance with specifications Reliability Durability Serviceability Fit and finish

Performance

Features

Conformance with specifications

Reliability

Durability

Serviceability

Fit and finish

What Influences Perceived Quality of Service ? Appearance Reliability Competence Responsiveness Empathy

The Value of Perceived Quality Reason-to-Buy Differentiate/Position A Price Premium Channel Member Interest Brand Extensions

Reason-to-Buy

Differentiate/Position

A Price Premium

Channel Member Interest

Brand Extensions

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.

Some Types of Associations Product Attributes Customer Benefits Relative Price Lifestyle/Personality Celebrity/Person Use/Application

Product Attributes

Customer Benefits

Relative Price

Lifestyle/Personality

Celebrity/Person

Use/Application

The Value of Brand Associations Help Process/Retrieve Information Differentiate/Position Reason-to-Buy Create Positive Attitudes/Feelings Basis for Extensions

Help Process/Retrieve Information

Differentiate/Position

Reason-to-Buy

Create Positive Attitudes/Feelings

Basis for Extensions

Maintaining Associations Be consistent over time Be consistent over elements of the marketing program Manage disasters in order to minimize their damage

Be consistent over time

Be consistent over elements of the marketing program

Manage disasters in order to minimize their damage

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

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

Source of Reference: David Aaker, Managing Brand Equity : Capitalizing on the Value of A Brand Name , Free Press