How to manage Brand equity.

Question 1

Define brand resonance

Accepted Answer

The Brand Resonance refers to the relationship that a consumer has with the product and how well he can relate to it. Brand resonance begins with the following four steps: 1. Brand identity, Brand meaning, brand responses and brand relationships. In order to accomplish these four pre-requisites for creating the brand equity, the six brand building blocks need to be followed that are arranged in a pyramid-like structure called as Brand Resonance Pyramid.

Question 2

1. Step of Brand resonance model

Accepted Answer

1. Brand Identity (who are you) : Ensure identification of the brand with customers and their association with a specific product class, benefit or need Brand salience: Brand salience measures various aspects of brand awareness: Helps customers understand the product or service category in which the brand competes, what products or services are sold under the brand name, and ensures that customers know which of their “needs” the brand is designed to satisfy. Brand Salience: The brand salience means, how well the customer is informed about the product and how often it is evoked under the purchase situations? The marketer should not only focus on just creating the awareness about the product but also includes the ease with which the customers can remember the brand and the ability to recall it under the different purchase situations.Brand awareness thus gives the product an identity by linking brand elements to a product category and associated purchase and consumption or usage situations Depth of awareness: measures how likely it is for a brand element to come to mind, and the ease with which it does so Breadth of awareness: measures the range of purchase and usage situations in which the brand element comes to mind Deep, Broad Brand Awareness

Question 3

2. Step of Brand resonance

Accepted Answer

2. Brand Meaning (what are you): Firmly establish the totality of brand meaning by strategically linking (in)tangible brand associations Brand performance: describes how well a product or service meets customer needs and wants in the respective product or service category Brand Performance: The Brand performance means, how well the functional needs of customers are met? At this level of the pyramid, the marketers check the way in which product is performing and how efficiently it is fulfilling the needs of the customers.To create brand loyalty and resonance, designing and delivering a product that satisfies consumer needs and wants, is a prerequisite Attributes and benefits affecting brand performance associations: Primary ingredients and supplementary features & Product reliability, durability and serviceability & Service effectiveness, efficiency and empathy & Style and design & Price Brand imagery: refers to the way people think about a brand abstractly; it illustrates more intangible aspects of the brand User profiles: associations about the typical or idealized brand user; based on descriptive demographic factors or more abstract psychographic factors Purchase and usage situations: associations about the conditions or situations under which consumers can or should buy and use the brand Personality and values: associations about a brand’s humanlike personality (e.g., modern, oldfashioned, lively or exotic) History, heritage and experiences: associations to past experiences or noteworthy event’s in the brand’s history; may be highly personal and individual or wellknown and shared by many people NIVEA: family, shared experiences, matern & multipurpose & classic, timeless & childhood memories Patagonia: high-quality outdoor clothing and equipment, Its brand performance demonstrates its reliability and durability; people know that their products are well designed and stylish, Patagonia’s brand imagery is enhanced by its commitment to several environmental programs and social causes; and its strong “reduce, reuse, recycle” values Points of parity and points of difference

Question 4

3. Step of brand resonance model

Accepted Answer

. Brand Responses: Elicit the proper customer responses to the brand Brand meaning: is what helps produce brand responses, or what customers think or feel about the brand. Brand Judgements & Brand feelings Responses must be positive, accessible and come to mind when consumers think of the brand. Brand judgments and feelings can favorably affect consumer behavior only if consumers internalize or think of positive responses in their various encounters with the brand Brand Judgements: Brand judgments are customers’ personal opinions about and evaluations of the brand, formed by putting together all different brand performance and imaginary associations Brand quality: judgements about the perceived quality of a brand, based on the extent to which it creates customer value and satisfaction Brand credibility: which customers see the brand credible in terms of perceived expertise, trustworthiness and likability Brand consideration: the extent to which customers give the brand serious consideration in purchase and usage situations and deem it relevant Brand superiority: the extent to which customers view the brand as unique and better than others Brand feelings: Brand feelings are customer’s emotional responses and reactions to the brand from mid to intense and positive to negative. How the customer is emotionally attached to the product.

Question 5

Brand feelings

Accepted Answer

Warmth, fun, excitement, security, social approval, self-respect

Question 6

4. Step of brand resonance

Accepted Answer

4. Brand Relationships: Convert brand responses to create brand resonance and an intense, active loyalty relationship Brand resonance refers to the ultimate relationship and level of identification the customer has with the brand. The Brand Resonance means, what psychological bond, the customer has created with the brand? Intensity: depth of the psychological bond that customers have with the brand (attitudinal attachment, sense of community) Activity: level of activity engendered by this loyalty. (behavioural loyalty, active engagement)

Question 7

Define the brand value chain

Accepted Answer

· The brand value chain is a structured approach to assessing the sources and outcomes of brand equity and how marketing activities create brand value. The brand value chain therefore is a tool to better understand the ROI of marketing investments.

Question 8

1. Step of BVC

Accepted Answer

1. Marketing Program Investment: The brand value creation process begins when the firm invests in a marketing program targeting actual or potential customers. Any marketing program investment that can contribute to brand value development falls into this first value stage. Product research, development and design Trade or intermediary support Marketing communications Employee training è The success of marketing program investment hinges on the qualitative aspects of the marketing program and the program quality multiplier 1.1 Program Quality Multiplier: The success of a marketing program investment, i.e. its ability to affect the customer mind-set, depends on its quality; the quality of a marketing program can be evaluated based on the following considerations Relevance: How meaningful is the marketing program to customers? Do consumers feel the brand is one they should seriously consider? Distinctiveness: How unique is the marketing program? Integration: How well integrated is the marketing program at one point in time and over time? Value: How much short-run and long-run value does the marketing program create? Excellence: Is the individual marketing activity designed to satisfy the highest standards?

Question 9

2. Step BVC

Accepted Answer

2. Customer Mind-Set: In what ways have the customers been changed as a result of the marketing program? How do those changes manifest themselves in the customer mindset? (brand awareness, brand associations, brand attitude, brand attachment, brand activity) 2.2 Marketplace Conditions Multiplier. (Marketplace conditions are the external factors that affect the overall performance of a marketing program investment.) The extent to which value created in the minds of customers affects market performance depends on Competitive superiority & Channel and other intermediary support & Customer size and profile The value created in the minds of customers will translate to favorable market performance when competitors fail to provide a significant threat & when channel members and intermediaries provide strong support & when a sizable number of profitable customers are attracted to the brand

Question 10

3. Step BVC

Accepted Answer

3. Market performance Customer mind-set, across a broad group of customers, affects the brand’s performance in the marketplace mainly in the following six waysà Market performance is the result of a positive customer’s mindset due to the increase in the sales of the product or service. Price premiums (Companies can charge for a premium price when customers have a strong positive mindset towards the brand) Price elasticities (if the company decides to increase the price of their product or service, it will not affect the purchasing behavior of their customers.) Market share (The total sum of loyal customers will affect the greater share of the total addressable market.) Brand profitability (Creating a strong brand gives companies a competitive edge and stretches the profitability of the company.) Cost structure ( A successful marketing program investment will also reduce further marketing investment costs as the brand has a strong presence in the customer’s mind.) Brand expansion ( A successful marketing program investment, directed to a brand extension, will provide additional opportunities for companies to add a product line or depth, thus adding on a new revenue stream.) 3.3 Investor Sentiment Multiplier: Factors financial analysts and investors consider in arriving at their brand valuations and investment decisions Market dynamics: What are the dynamics of the financial markets as a whole? Growths potential: What is the growth potential for the brand and the industry in which it operates? Risk profile: What is the risk profile for the brand Brand contribution: How important is the brand to the firm’s brand portfolio?

Question 11

4. Step BVC

Accepted Answer

4. Shareholder Value: Based on all available information about a brand, the financial marketplace formulates opinions and assessments that have direct financial implications for the brand value Stock price Price / earning multiple Overall market capitalization

Marketing (Subject) / How to manage Brand equity. (Lesson)