MEASURING BRAND EQUITY

Introduction

Brand measurement is often alternatively referred to as Brand equity measurement, because most of the parameters that are commonly measured evolve from the concept of brand equity. When we measure brands we are in effect measuring brand equity.

Branding adds a dimension that differentiates a product other from others that meet the same need. Regardless, whether the product is a physical product, a service, a retail store, an organization, a person, a place, or an idea, they are all subject to a branding process in customers mind. In the brand realm ,reality is always perception

Methods of measuring brand equity.According to the brand value chain, sources of brand equity arise from the customer mindset. In general, measuring sources of brand equity requires that the brand manager fully understand how customers shop for and use products and services and most important, what customers know ,think, and feel about various brands.

Measuring sources of brand equity and consumer mind set encompasses following techniques:

1) Qualitative research technique

2) Quantitative research technique.

Qualitative research techniques Qualitative research techniques often identify possible

brand associations and sources of brand equity. Qualitative research techniques are relatively unstructured

measurement approaches that permit a range of possible consumer responses.Because of the freedom afforded both researchers in their probes and consumers in their responses, qualitative research can often be a useful first step in exploring consumer brand and product perceptions.

Main qualitative techniques used for measurement of brand equity are as follows..a. Free association

b. Projective techniques

c. Brand personality and values

d. Experimental methods

a. Free association The simplest and often the most powerful way to profile brand associations is free association tasks, in which subjects are asked what comes to mind when they think of the brand, without any more specific probe or cue than perhaps the associated product category.

Ex: What comes in our mind when we think of KFC chicken

Marketers can use the resulting associating to form a rough mental shop for the brand.

For example, if many consumers mention” fast and convenient” as one of their first associations when given “ Mc donald’s restaurant” as a probe, then the association is probably a relatively strong one and likely able to affect consumer decisions. Associations later in the list may be weaker and thus more likely to be overlooked during consumer decision making. Comparing associations with those elicited for competitive brands can also tell us about their relative uniqueness.

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To provide more structure and guidance, consumers can be asked further follow up questions to describe what the brand means to them in terms of “ Who, what, where, why and How” questions such as following:

1) Who uses the brand? What kind of person?

2) When and where do they use the brand?

3) Why do people use the brand? What do they get out of using it?

4) How do they use the brand? What do they use it for?

Example:

Samsung mobile

Easy to use First phone

Latest technology Good reputation

b. Projective techniquesProjective techniques are diagnostic tools to cover opinions and feelings of customers when they are unwilling or otherwise unable to express themselves on these matters.

The idea behind projective techniques is that consumers are presented with an incomplete stimulus and asked to complete it or given an ambiguous stimulus that

may not make sense in and of itself and asked to make sense of it.Kinds of projective techniquesa) Completion and interpretation tasks

Classic projective techniques use incomplete or ambiguous stimuli to elicit consumer thoughts and feelings. One approach is bubble exercises which depict different people buying or using certain products or services, Empty bubbles as in cartoons are placed in the scenes to represent the thoughts, words or actions of one more of the participants. Marketers then ask consumers to “fill in the bubble” by indicating what they believe is happening or being said in the scene. The stories and conversations told through bubble exercises and picture interpretations can be especially useful for assessing user and usage imagery of brand.

b) Comparison tasks

Another useful technique is comparison tasks, in which we ask consumers to convey their impressions by comparing brands to people, countries, animals, activities, fabrics, occupations, cars, magazines, vegetables, nationalities or even other brands.

Ex: During the 2004 US presedential election, a random sample of undecided voters offered the following comparisons of the republican candicate, president George W.Bush and the Democratic candidate, Senetor John kerry, to various popular brands.

Con….

ASSOCIATION BUSH KERRY

Coffee Dunkin’ donuts Starbucks

Technology IBM apple

Auto Ford BMW

Retail K mart Target

Fast food Mc donald’s subway

C) Brand personality and values

Brand personality is the human characteristics or traits that can be attributed to a brand. Brand personality can be measured in different ways, as given below Perhaps the simple and most direct way is to

solicit open ended responses to a probe such as following:

I. If the brand were to come alive as a person, what would it like be like?

I. What would it do?

II. Where would it live?

III. What would it wear?

Other means are possible to capture consumers point of view

Ex: Consumers could be given a variety of pictures or a stack of magazines and asked to assemble a profile of the brand. These pictures could be of celebrities or anything else. Big five:

We can assess Brand personality can be assessed more definitively through adjective checklists or ratings. Jeniffer Aaker conducted a research project that provides an interesting glimpse into the personality of a number of well known brands, as well as a methodology to examine the personality of any one brand.

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She created a brand personality scale that reflected the following five factors with underlying facets of brand personality:1) Sincerity(down to earth, honest, wholesome, and

cheerful)

2) Excitement( daring, spirited, imaginative and up to date)

3) Competence( reliable, intelligent, and successful)

4) Ruggedness (outdoorsy and tough)

Quantitative techniques.Quantitative research typically employs various types of scale questions so that numerical representations and summaries can be made quantitative measures of brand knowledge can be employed to better access the depth and breadth of brand awareness, the strength, favorability and uniqueness of brand associations.

Quantitative measures are often the primary ingredient in tracking studies that monitor brand knowledge structures of consumers overtime, it includes following aspects.

Kinds.. Awareness Image Brand responses Brand relationship

Brand relationships1. Behavioral loyalty

To capture reported brand usage and behavioral loyalty, consumers could be asked several questions directly

For ex: the marketers of brand managers of Duracell batteries might ask the following questions Which brand of battery do you usually buy? Which brand of batteries did you buy last time?

Do you have batteries on hand? Which brand? Which brands of batteries did you consider buying? Which brands of batteries will you buy next time?

2. Brand substitutabilityIndustry consultants Longman and Moran have developed a measure of substitutability related to brand behaviors that they see as a key source of brand equity, Their measure is based on a scale produced by the answers to two questions

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Awareness

Brand awareness is related to the strength of the brand in memory, as reflected by consumers ability to identify various brand elements ie the brand name, logo ,symbol, character, packaging, and slogan under different conditions brand awareness relates to the likelihood that a brand will come to mind and the ease with which it does so given different of cues. Image

One vitally important aspect of the brand is its image, as reflected by the associations that consumers hold regarding the brand. Strong , favorable and unique associations provide the foundation for customer based brand equity. Brand responses

The purpose of measuring more general higher level considerations is to find out how consumers combine all more specific, lower level considerations about the brand in their minds to form different types of brand responses and evaluations.

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I. Which brand did you buy last time?

II. If the brand had not been available, what would you have done?

(waited, gone to another store, or bought another brand, which one?)

Based on the responses they place consumers into one of six segments, of decreasing value of brand:

1. People who bought your brand last time and who would have waited or gone to another store to buy your brand.

2. People who bought your brand last time but would have accepted any other brand as a substitute.

3. People who bought your brand last time but specified a particular other brand as a substitute

4. People who bought another brand last time but named your brand as a possible substitute

5. People who bought another brand last time and did not name your brand as a substitute

6. People who bought another brand last time and would have waited or gone to another store to buy that brand

Methods of measuring outcomes of brand equity1. Comparative methods

2. Holistic methods

Comparative methods:

Comparative methods are research studies or experiments that examine consumer attitudes and behavior toward a brand to directly estimate the benefits arising from having a high level of awareness and strong favorable and unique brand associations.

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There are two types of comparative approaches Brand based Marketing based

Brand based comparative approachesCompetitive brands can be useful benchmarks in brand based comparative approaches. Although consumers may interpret marketing activity for a ficticiously named or unnamed version of the product or service in terms of their general product category knowledge.

Ex; The classic example of the brand based comparative approach is “blind testing” research studies in which consumers examine or use a product with or without brand identification.

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Marketing based comparative approachesMarketing based comparative approaches hold the brand fixed and examine consumer response based on changes in the marketing program.

Applications;

There is a long academic and industry tradition of exploring price premiums using marketing based comparative approaches. In the mid 1950’s, Edgar pessemier developed a dollarmetric measure of brand commitment that relied on a step by step increase of the price difference between the brand normally purchased and an alternative brand. To reveal brand switching and loyalty patterns, pessemier plotted the percentage of consumers who switched from their regular brand as a function of the brand price increases.

For ex: Intel routinely surveys computer shoppers to find out how much of a discount they would require before switching to a personal computer that did not have an intel microprocessor in it or conversely, what premium they would be willing to pay to buy a personal computer with an intel microprocesser in it.

Conjoint analysisConjoint analysis is a survey based multivariate technique that enables marketers to profile the consumer buying decision process with respect to products and brands. Specifically by asking customers to express preferences or make choices among a number of carefully designed different product profiles, marketing researchers can determine the trade offs consumers are making between various brand attributes and thus the importance that consumers are attaching to those attributes.

Ex: one classic study of conjoint analysis, reported by Green and Wind examined consumer evaluations of a spot remover product on five attributes: package design, brand name, price, good house keeping seal, and money back gaurantee.

Holistic methodsComparative methods attempt to approximate specific benefits of brand equity. Holistic method attempts to place an overall value for the brand in either abstract utility terms or concrete financial terms. Thus holistic methods attempt to net out various considerations to determine the unique contribution of the brand.

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The residual approach attempts to examine the value of the brand by subtracting out consumers preferences for the brand based on physical product attributes alone from their overall brand preferences.

The valuation approach attempts to place a financial value on brand equity for accounting purposes, mergers and acquisitions or other such reasons.