Brand Equity

What is Brand equity? Set of assests/liabilities linked to a brand name/symbol that adds to the value provided by a product/service to a firm

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Brand Equity rests on assets

Brand equity is a set of assets Brand equity assets create value in different ways Brand equity creates value for customer/firm (model from Brand equity pdf paper, Determinants of

brand equity - A blue print for building strong brand: A study of automobile segment in India)

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Enhances value for Column 1 Column 2 firm

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0 Row 1 Row 2 Row 3 Row 4

Conceptual framework of Brand Equity

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Brand equity Aaker model

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1. Brand Awareness
Presence in mind Mental bill boards Awareness measurement Recognition Recall Top of mind Dominant

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Brand Recognition
Do a brand recognition test with tagline/logo/jingle Simply remember the brand Familarity and liking

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Brand Recall
When a particular brand comes to mind when a particular product class is mentioned Recognition vs Recall model

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Brand Dominance
Where there is ultimate awareness Where in a recall task, most customers can provide the name of a single brand Aspirin, Escalator, Bisleri, Colgate

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Creating awareness
Customers bombarded with ads Challenge of recall and recognition Healthy awareness by broad sales base Promotions, publicity, sampling

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2. Perceived Quality
Perceived quality is a brand association elevated to the status of brand asset Why? It drives financial performance Is a measure of brand goodness Is often a major strategic thrust of a business

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Perceived Quality drives Fin perf

perceived quality is the single most important contributor to a company''s return on investment (ROI) having more impact than market share, R&D, or marketing expenditures Perceived quality contributes to profitability in part by enhancing prices and market share As perceived quaility improves, ROI improves
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Perceived Quality drives Fin perf

perceived quality was a major driver of customer satisfaction The study at American Express, AT&T, Avon, Citicorp, Coke, Kodak, Ford, Goodyear, IBM, Kellogg's, and 23 other firms for which the corporate brand drove a substantial amount of sales and profits. Remarkably, the impact of perceived quality was nearly as great as that of ROI , even when the researchers controlled for advertising expenditures and awareness levels.
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Perceived quality as a strategic thrust

Many firms include quality in their mission statement Perceived quality as a key positioning dimension (TQM) or one of its relatives has been central to many firms

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Perceived quality as a measure of Brand goodness

Usually at the heart of what the customers are buying It is a bottom-line measure of the impact of a brand identity Spreads like a thick syrup

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How to create perceptions of quality

Needs to understand what quality means Perceived quality is different than actual It is for many reasons 1st, consumers may be overly influenced by previous image 2nd, company may be achieving quality on a dimension that consumers do not think is important

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How to create perceptions of quality

3rd, consumers rarely have all the information necessary to make a rational and objective judgement on quality 4th, consumers may not know how best to judge quality. They may be looking at wrong cues

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