customer based brand equity (cbbe) by leroy j. ebert
DESCRIPTION
Customer Based Brand Equity course content for the Sri Lanka Institute of Marketing - Diploma in Brand Management Subject: Strategic Brand ManagementTRANSCRIPT
PRODUCT VS. BRAND
Attention, acquisition, use or consumption, employee, political figure, department store
Additions in terms of packaging, services, advertising, customer advice, associations and other things that people value,
THE SECRET OF SUCCESSFUL BRANDS
CUSTOMER BASED BRAND EQUITY (CBBE)
• The power of the brand lies in what resides in the minds of the
customer
• CBBE- defined as “the differential effect that brand knowledge
has on consumer response to the marketing of that brand”
• A brand has positive CBBE when consumers react more
favorably to a product and the way it is marketed when a
brand is identified than when it is not.
3 KEY INGREDIENTS OF THIS DEFINITION
“the differential effect that brand knowledge has on consumer
response to the marketing of that brand”
1. Differential effect
2. Brand Knowledge
3. Consumer response to marketing
I.E. FIGURE 2.2
Results of Blind beer taste tests
MARKETING ADVANTAGES OF STRONG BRANDS
• Improved perceptions of product performance
• Greater Loyalty
• Less vulnerable to competitive marketing actions
• Larger margins
• Inelastic response to price increase
• Elastic response to price reductions
• Increased Marcom effectiveness
• Brand extension opportunities
MAKING A STRONG BRAND
Key driver is Brand knowledge
Brand awareness
Brand image (associations and characteristics)
ASSOCIATION TEST 1
ASSOCIATION TEST 2
ASSOCIATION TEST 3
SOURCES OF BRAND EQUITY
Brand recognition
and
brand recall
BENEFITS OF BRAND AWARENESS
Learning Advantage – Customers are more receptive
Consideration Advantage – consideration set
Choice Advantage – affect choice amongst the consideration set
Consumer purchase motivation – indifference i.e. gas
Consumer purchase ability – inability to judge what’s best due to lack of
prior experience i.e. new cooks
All brands
Known Brands
Acceptable brands
Unacceptable brands
Indifferent brands
Over looked brands
Unknown Brands
COMPETITIVE BRAND ALTERNATIVES –
DEFINING COMPETITIVE SET
Evoked Set Rejected brands Inept set
ESTABLISHING BRAND AWARENESS
• Increasing the familiarity of the brand
• The more the consumer interacts with the brand (seeing,
hearing or thinking about it) the more aware they get
• Anything that causes a consumer to experience the brand
DISTINCTIVENESS
BRAND RECALL REQUIRES LINKAGE TO THE
PRODUCT CATEGORY
BRAND IMAGE
• Is built through favorable brand association
• Consistency – don’t change over time
• Favorability brand associations – depends on the
customer, time, nature of association
• Uniqueness of brand associations
BRAND BUILDING BLOCKS
• Brand Salience – measures the awareness of the brand
• i.e. how often and how easily the brand is evoked under various
situations or circumstances.
• To what extent is the brand top of the mind easily recalled or
recognized?
• Brand Salience – helps us understand the degree to which the
customers understand the product or service category in which the
brand competes and what products or services are sold under the
brand name
• It also ensures that customers know which of their needs the brand
through these products is designed to satisfy
PRODUCT CATEGORY STRUCTURE – ORGANIZED IN
THE MEMORY OF CUSTOMERS
BRAND BUILDING BLOCKS
• Brand Performance – the product is at the heart of brand equity.
• It directly influences the consumer experience with the brand.
• It defines how well does the product or service meets the customers more functional needs
• How well the brand rate on assessment of quality?
• To what extent does the brand satisfy utilitarian, aesthetic and economic customer needs and wants in the product or service category?
5 attributes to product performance
• Primary ingredients and supplementary features
• Product reliability, durability and serviceability
• Service effectiveness, efficiency and empathy
• Style and design
• Price
BRAND IMAGERY
• Includes the ways in which the brand attempts to meet the customers
psychological or social needs
• It is the way people think about the brand abstractly rather than what the brand
actually does
• Thus imagery refers to the more intangible aspects of the brand
• Customers can form imagery about a brand based on their own experience or
indirectly through advertising or by some other source of information
• 4 main intangible that can be linked to a brand are
1.User profiles
2.Purchase and usage situations
3.Personality and values
4.History, heritage and experiences
BRAND JUDGEMENT
• Are the consumers personal opinions about and evaluations of the
brand, which consumers form by putting all the different brand
performance and imagery associations.
• Brand quality: perceived quality
• Brand credibility: perceived expertise, trustworthiness, and likability
• Brand consideration: strong and favourable brand associations and
imagery
• Brand superiority: Unique and better than other brands. Number and
nature of unique brand associations that make up the brand image
BRAND FEELINGS
• Are the customers emotional response and reactions to the brand.
• 6 important types of brand building feelings i.e. Titan
1. Warmth: sense of calm and peacefulness, sentimental, warm-hearted or affectionate about a brand
2. Fun: upbeat types of feelings make consumers feel amused, light-hearted, joyous, playful, cheerful i.e. Disney
3. Excitement: the brand that makes consumers feel energized and that they are experiencing something special i.e. Redbull
4. Security: feeling of safety, comfort and self assurance i.e. Ceylinco
5. Social Approval: feel that others look favourable on their response i.e. Mercedes
6. Self respect: makes consumers deel better about themselves i.e. P&G
BRAND RESONANCE
• Ultimate relationship with the brand
• Describes the nature of this relationship and the extent to which
consumers think they are in sync with the brand.
• The intensity of the psychological bond the consumer has with the brand
• The level of activity engendered by this loyalty i.e. repeat purchase,
seeking out information
• Behavioural loyalty: repeat purchases and category share (CLV)
• Attitudinal attachment:
• Sense of community
• Active engagement
CUSTOMER BASED BRAND EQUITY PYRAMID
POSSIBLE MEASURES OF BRAND BUILDING BLOCKS
Figure 2.9 page 75
POSSIBLE MEASURES OF BRAND BUILDING BLOCKS
Figure 2.9 page 75 &76
SHOULD BRANDS HAVE DUALITY
Head Heart
BRAND RANKINGS ON RESONANCE DIMENSIONS
Fig 2.10 – page 79
CREATING CUSTOMER VALUE
CRM – relationship management, use IT to support
Customer Equity – CLV
Invest in highest value customers first
Product management to customer management
Up sell and cross sell
Reduce acquisition costs
Track customer equity gains and losses against marketing programs
Relate branding to customer equity
Retainability of customers
HAVE 2 MKTN PLANS, OR 2 DEPTS FOR ACQUISITIONS AND RETENTION
BRAND VS. CUSTOMER EQUITY
• Brand Equity – customers subjective and intangible
assessment of the brand beyond its objectively
perceived value
• Customer Equity - is the total combined customer
lifetime values of all of a company's customers
COURSE BOOK – STRATEGIC BRAND
MANAGEMENT Customer Based Brand Equity Chapter 02
Authors
Kevin Lane Keller
M.G. Parameswaran
Isaac Jacob
Presentation compiled by Leroy J. Ebert
Chartered marketer, MCIM, MSLIM
Manager Marketing and Business
Logiwiz Ltd.