CBBE: Consumer Based Brand Equity

Objectives for each stage of Brand Development:

1. Identity: Deep, broad brand awareness2. Meaning: Points of parity and difference3. Response: Positive, accessible reactions4. Relationships: Intense, active loyalty

Brand Salience: measures awareness of the brand

Depth: how likely it is for a brand element to come to mind

Breadth: the range of purchase and usage situations in which a brand element comes to mind.

Points of Difference: Attributes that consumers strongly associate with a brand, positively evaluate, andbelieve they could not find to the same extent with a competitive brand.

Points of Parity: Not unique to a brand, but may be shared with other brands.

Brand Inventory: Includes… names, logos, characters, packaging, slogans, trademarks, inherent product attributes or characteristics of the brand, pricing, communications, distribution policies

Brand Exploratory: provides detailed information as to how consumers perceive the brand – finds sources of customer based brand equity

The Brand Value Chain: A structured approach to assessing the source and outcomes of brand equity and the manner by which marketing activities create brand value

Brand Value Chain Creation Process:

1. Invest in marketing program2. Associated marketing activity affects customer mind set3. Mindset produces the brand performance4. Investment community considers market performance5.

Brand Equity Charter: Formalized company view of brand equity into a document

Brand Equity Report: Complementary approached based on the GAME plan which measures both input and outcome metrics.

GAME plan:

G – Goal: Identity key brands for next fiscal period

A – Activity: Locate current status on baseline

M – Measurement: Allocate inputs with specific objectives

E – Evaluation: Assess all outputs

Brand Equity Responsibilities: Organizational design and structures reflect the growing recognition of the importance of the brand and the challenges of managing brand equity.

Zaltman Metaphor Elicitation Technique (ZMET): A technique for eliciting interconnected constructs that influence thought and behavior, based on a belief that consumers often have subconscious motives for their purchasing behavior.

Brand Personality refers to the human characteristics or traits that can be attributed to a brand.

The Big 5

Sincerity - down to earth, wholesome, cheerful

Excitement – daring, spirited, imaginative and up to date

Competence – reliable, intelligent and successful

Sophistication – upper class and charming

Ruggedness – outdoorsy and tough

Advantages of Qualitative Techniques: Creative. Ascertain consumer perceptions that may otherwise be difficult to uncover. Range in techniques is only limited by creativity.

Disadvantages of Qualitative Techniques: In-depth insights must be tempered by small sample sizes – can’t make generalizations. Could be questions of interpretation.

Brand Dynamics:

In Millward Brand’s model consumers are placed into 5 difference brand responses: Presence, Relevance, Performance, Advantage, Bonding – the model adopts a hierarchical approach to determine the strength of the relationship a consumer has with a brand

The Equity Engine model is based in 3 dimensions of brand affinity – Authority, Identification, Approval – combining brand affinity with measures of a brand’s perceived performance. The equity measure is combined with price to provide a closer marketplace approximation of how consumers combine brand associations to make decisions.

Four Pillars of BAV – Difference, Relevance, Esteem, Knowledge - BAV provides comparative measures of equity value – it’s the world’s largest database of consumer-derived info on brands.

The Powergrid depicts the stages in the cycle of brand development, each with its characteristics pillar patterns in successive quadrants.

Brand-Based Comparative Approaches are particularly applicable when the marketing activity under consideration represents a change from past marketing of the brand.

Marketing-Based Comparative Approaches are statistical techniques well suited to determine whether consumer response is specific to the brand.

Conjoint analysis applications – assess advertising effectiveness and brand value, analyzing brand or price trade-off

Srinivasan, Park, and Chang’s model – uses 3 components – Brand Awareness, Attribute perception biases, and non-attribute preference - to measure brand equity based on the “multi-attribute attitude model”

Types of Valuation Approaches: (calculating the financial value of a brand)

Accounting Background:

Cost Approach: Brand Equity is the amount of money that would be required to reproduce or replace the brand

Market Approach: The present value of the future economic benefits to be derived by the owner of the asset

Income Approach: The discounted future cash flow from future earnings stream for the brand

Valuation Approaches:

Market Segmentation: Split consumer market for brand into homogenous groups

Financial analysis: Identify & forecast revenues and earnings from tangibles generated by the brand for each of the distinct segments.

Demand analysis: Assess the role the brand plays in driving demand for products & services

Competitive Benchmarking: Determine competitive strengths and weaknesses to the brand to derive the brand’s specific discount rate

Brand Value Calculation: Calculate the brand value as the NPV of forecast brand earnings, discounted by the brand discount rate

The Brand Product Matrix:

Brand Line – all products sold under a particular brand – may include different brands or a single family brand or individual brand that has been line extended.

Brand portfolio – set of all brands and brand lines that a particular firm offers for sale to buyers

Breadth of Branding Strategy – Breadth of Product Mix:

3 categories determine inherent attractiveness of a product category: Aggregate market factors, category factors and environmental factors

Combining Brand Elements from Different Levels: Primary brand elements should convey the main product positioning and points of difference… secondary brand elements convey a more restricted set of supporting associations, such as points of parity or perhaps an additional point of difference.