Chapter 8 - Chapter 8 Developing a Brand Equity Measurement...

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Chapter 8: Developing a Brand Equity Measurement and Management System Indirect approach: assess potential sources of CBBE by identifying and tracking consumers’ brand knowledge Direct approach: assess actual impact of brand knowledge on consumer response to different aspects of marketing program Brand equity measurement system: set of research procedures designed to provide marketers with timely, accurate, and actionable information on brands so they can make decisions Brand value chain: means by which marketers can trace the value creation process for their brands The New Accountability Return of marketing investment (ROMI) Some marketing expenditures may be devoted to programs and activities linked to building brand equity, not short- term profits - Measure brand in terms of ability to generate future cash flows - Create value only by changing customer behavior (not just attitudes) - Measure brand equity in a way that captures the source and scale of the emotional component the brand adds to the functionality of the product Brand Value Chain Definition: structured approach to assessing the sources and outcomes of brand equity and the manner by which marketing activities create brand value. Stage 1 – when firm invests in a marketing program targeting actual or potential consumers Product, communications, trade, employee, etc Multiplier – Program quality – clarity, relevance, distinctiveness, consistency Stage 2 – marketing activity affects the customer mind-set (strong, favorable, unique associations) Awareness, associations, attitudes, attachment, activity Multiplier – Marketplace conditions – competitive superiority, channel and other intermediary support, customer size and profile Stage 3 – mind-set produces brand’s performance in the marketplace (freq of purchase, price consumers pay, etc) Price premiums, price elasticity, market share, expansion success, cost structure, profitability Multiplier – investor sentiment – market dynamics, growth potential, risk profile, brand contribution Stage 4 – investment community arrives at an assessment of shareholder value and value of brand Stock price, price/earnings multiple, overall market capitalization Multipliers: linking factors between stages that determine the extent to which value created at one stage transfers to the next stage Designing Brand Tracking Studies Tracking studies collect info from consumers on a routine basis over time. What to track Product-brand tracking – measure brand awareness and associations with product Corporate or family brand tracking – reflect nature and experience consumer had with company Global tracking How to conduct tracking studies Current customers v nonusers, heavy v light users, employees Depends on frequency of product purchase and consumer behavior and marketing activity in the product category How to interpret tracking studies Identify determinants of brand equity Establishing a Brand Equity Management System Brand equity management system: set of organizational processes designed to improve the understanding and use of
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Chapter 8 - Chapter 8 Developing a Brand Equity Measurement...

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