CHAPTER: 8 developing a brand equity measurement and management system

Learning Objectives Describe the new accountability in terms of ROMI Outline the two steps in conducting a brand audit Describe how to design, conduct, and interpret a tracking study Identify the steps in implementing a brand equity management system

The New Accountability Conducting Brand Audits Brand Inventory Brand Exploratory Brand Positioning and the Supporting Marketing Program The new accountability Need for increased accountability has led to develop brand value measurement approaches. Tools and procedures are required to justify expenditures beyond ROMI measures.

Conducting Brand Audits Brand audit: Comprehensive examination of a brand to discover its sources of brand equity Marketing audit: Independent examination of a company’s marketing environment, objectives, strategies, and activities agreement on objectives, scope, and approach data collection report preparation and presentation Brand audit Consumer-focused exercise to assess the health of the brand, uncover its sources of brand equity, and suggest ways to improve and leverage its equity. Useful background for managers as they set up their marketing plans and can have profound implications on brands’ strategic direction and resulting performance. Marketing audit Internal, company-focused exercise to make sure marketing operations are efficient and effective.

Brand Inventory   Comprehensive profile of how all the products and services of a company are marketed and branded Profiling requires marketers to catalogue: Visual and written form for each product or service sold The inherent product attributes or characteristics of the brand Pricing, communications, and distribution policies Rationale Helps understand consumers’ perceptions. Provides analysis and useful insights into how brand equity may be better managed. Reveals the extent of brand consistency and lack of perceived differences among different products sharing the brand name. Helps uncover undesirable redundancy and overlap that could lead to consumer confusion or retailer resistance.

Brand Exploratory Preliminary Activities Interpreting Qualitative Research Conducting Quantitative Research Brand exploratory Steps for brand exploratory: Study prior research. Interview internal personnel. Conduct additional research. Preliminary activities A number of prior research studies may exist and be relevant. It is useful to interview internal personnel to gain an understanding of their beliefs about consumer perceptions for the brand and competitive brands. Additional research is often required to better understand how customers shop for and use different brands and what they think and feel about them. Interpreting qualitative research Qualitative research should: Vary in direction and depth as well as in technique. Provide accurate interpretation. Ask specific questions, so as to narrow the range of information given by the respondents. Ask open ended questions for freer and less constrained responses. Mental maps and core brand associations Mental map: Accurately portrays in detail all salient brand associations and responses for a particular target market. Core brand associations: Abstract associations that characterize the 5 to 10 most important aspects or dimensions of a brand. Conducting quantitative research Assess all potentially salient associations identified by the qualitative research phase according to their strength, favorability, and uniqueness. Examine both specific brand beliefs and overall attitudes and behaviors to reveal potential sources and outcomes of brand equity. Assess the depth and breadth of brand awareness by employing various cues. Conduct similar types of research for competitors to better understand their sources of brand equity and how they compare with the target brand.

Brand Positioning and the Supporting Marketing Program Ideal brand positioning aims to achieve congruence between: What customers currently believe about the brand What customers will value in the brand What the firm is currently saying about the brand Where the firm would like to take the brand

Figure 8.5 - John Roberts’s Brand Positioning Considerations

Designing Brand Tracking Studies Product- brand tracking Corporate or family brand tracking Global tracking What to Track Whom to track When and where to track How to Conduct Tracking Studies Important benchmarks Brand associations determining consumer behavior How to interpret Tracking Studies

Establishing a Brand Equity Management System Brand Charter Brand Equity Report Brand Equity Responsibilities Brand equity management system Set of organizational processes designed to: Improve the understanding of brand equity. Use of the brand equity concept within a firm.

Brand Charter Formalizes the company view of brand equity into a document Provides relevant guidelines to marketing managers and key marketing partners Should be updated on an annual basis to provide decision makers with a current brand profile Brand charter Should: Define the firm’s view of branding and brand equity and explain why it is important. Describe the scope of key brands. Specify what the actual and desired equity is for brands at all relevant levels of the brand hierarchy. Explain how brand equity is measured in terms of the tracking study and the resulting brand equity report. Suggest how marketers should manage brands with some general strategic guidelines, stressing clarity, consistency, and innovation in marketing thinking over time. Outline how to devise marketing programs along specific tactical guidelines. Specify the proper treatment of the brand in terms of trademark usage, design considerations, packaging, and communications.

Contents Dashboards Brand Equity Report Contents A brand equity report should describe: What is happening with the brand? Why is it happening? Should include more descriptive market-level information. Dashboards Provides comprehensive but actionable summaries of brand-related information.

Brand Equity Responsibilities Overseeing Brand Equity Organizational Design and Structures Managing Marketing Partners Overseeing brand equity To provide central coordination, the firm should: Establish a position responsible for overseeing the implementation of the brand charter and brand equity reports. Ensure that product and marketing actions across divisions and geographic boundaries reflect their spirit as closely as possible. Maximize the long-term equity of the brand. Organizational design and structures Firms may attempt to redesign their marketing organizations to better reflect the challenges faced by their brands. To meet the challenges of changing job requirements and duties, traditional marketing departments may be replaced by business groups, multidisciplinary teams, and so on. New organizational structure aims to improve internal coordination and efficiencies as well as external focus on retailers and consumers. Managing marketing partners Performance of a brand is also dependent on the actions taken by outside suppliers and marketing partners. Global trend indicates that firms are increasingly consolidating their marketing partnerships and reducing the number of their outside suppliers. Number of outside suppliers any firm will hire in any one area depends on: Cost efficiencies Organizational leverage Creative diversification affect

To Sum up... The company view of brand equity should be formalized into a document The results of the tracking surveys should be assembled into a brand equity report Senior management must be assigned to oversee brand equity within the organization