nov. 28? 1980 maricetihs news page 5 brand awareness ... · pdf filel r. nov. 28? 1980...

Post on 30-Mar-2018

216 Views

Category:

Documents

1 Downloads

Preview:

Click to see full reader

TRANSCRIPT

Lr.

Nov. 28? 1980 Maricetihs News Page 5

Brand awareness increiases market share, profits: studyPROGRAMS THAT BUILD andmaintain brand awareness increasemarket share and profit levels, accord-ing to a recent study by the StrategicPlanning Institute (SPI), a not-for-profit research organization based inCambridge, Mass.

While the impact, of market shareon profitability (as measured by pre-tax return on investment) has ldng^been identified (see Exhibit 1), SPIsaid its research provides evidencethat brand awareness is the "criticalfirst link in the chain."

"Aggressive" marketing and adver-tising, the SPI said, are the key factors— Engineer. Plastics World arid Profes-

1973-1978 data from firms participat-ing in the Profit Impact of MarketingStrategy (PIMS) program, which isoperated by SPI and contains the stra.-tegic experiences of 2,(X)0 separatebusiness units managed by the 250member companies.

The brand awareness link in thestudy wasi)rovid^ by^ahners Pub-lishing Co., Boston, publisher of 31specialized business magazines anddirectories. Cahners regularly surveysits readers to determine brand prefer-ence levels. Data was collected fromreaders of Design News, Specifying

in increasing brand awareness and ihconverting awareness to marketshare. Results from the 73 businessesevaluated in the study show that themore spent on adyertisiog and pro-motion as a percent of sales, the morethe increase in brand awareness levels.

Brand awareness, as it relates toprofits and share, has been dismissedby some companies as a measuredreamed up by their ad agencies, 2il-

Jhough many marketers havl sup-ported the'theory based on their expe-rience and intuition.

"Marketers and advertisers cannow heave a collective sijgh of relief,"said SPI executive Sidney Schoeffler."The programs that increase brandawareness and the programs thatconvert it into market share should bea hiajor concern of senior manage-ment."

RESEARCH' WAS BASED on

sional Builder magazines."The overall effect of the study un-

derlies a belief and working philos-ophy already followed and acceptedby most top corporate managements,marketers, and advertisers," said'J.Allan Sheehan, president of Cahners,which coordinated! and sponsored theresearch. ' —

"Now we have empirical proof thatthese people have been right aU alongin using advertising and other market-ing strategies^, to. increase brandawareness, which in turn can be con-verted into market sbare apd ultimate-ly into increased return on invest-ment."

A major feature of the study is theflow chart (see Exhibit 2) which out-lines the sequence of events that oc-curs in using ^rand awareness to in-crease pro|lts. . - •

How Brand Awareness aids ProffitdbilityThe Sequence of Events

Exhibn2

Previous Level otBrand Awareness

Changes inBrand Awareness

Current Levei dtBrand Awareness

• • IBfand tuvarencss cJecfeases by tf>e rtBfmatP'ocess and increases byI n I dotnq ^n abovr p«r vd'uTie otE «penaiiu'es Sates

Conversion Rate otBrand Awarenessinto Market Share

e c<yivers«>n rate t

Level ot AchievedMarket Share

whichstnsngly

I influences IROIorProtitabilitv

q recently successKj! m conwefii

Feb. 9-11 In Oriando, Fla. —-^-.

AMA's Conference Oil

BUT BRAND AWARENESS can"decay" unless stimulated by above-average spending on advertising,marketing, and promotion, the'studywarns. "Highly visible market leaderscannot feel complacent and rest ontheir coiporate laurels or their compe-

^ i o n will ^ i n in awareness • andmarket share," Sheehan explains.

The next step on the chart, he said,is the most critical in increasiogprofits—the conversion of brandawareness into market share (see Ex-hibit 3).

<̂!̂ 3(ir study shows that undifferen-tiated or 'me too' suppliers have themost difficulty in converting aware-ness to market share, and generally incompeting profitably," said Schoeff-ler. "Besides^ increasing competitivelevels of awareness, it pays to establisha clear product or capability unique-

Marketingfeatar)R practitioner, educator perspectives

Neil Beckwith

THE AMA s SPECIAL Conference"oilServices Marketing,^eb. 9-11,Or-lando, Fla., will feature a diversifiedprogram of practitioner and educatorperspectives, according to cochair-men Jim Donnelly, University ofKentucky, and Bill George, RutgersUniversity.

When attendees gather for the con-ference's first general session onMonday morning, Feb. 9, they'll heara debate on "The Validity of a Se'p-arate Approach for Services Market-\ •. r» ..̂ iing," by Ben M. Enis, University of James H. DonnellyMissouri, and Christopher LoveliHarvard University.

At another general session on Feb.11, Neil Beck with, chief marketing of-ficer, ARA Services, and Robert Cat-lin, senior vice president, NW AyerABH International, will discuss"Practitioners' Perspectives on Ser-vices Marketing." And at4hcday luncheon, Robert M. Krughoff,president, Washington Center for theStudy of Services, will speak on "Eval-uating Services."

Workshops and-panel discussionswill cover a variety of topies such asbank marketing, marketing implica-tions of deregulation, public relationsin services marketing, middlemenstrategies in nonprofit organizations,teaching nonprofit marketing, and in-ternational perspectives on servicesmarketing.

TWO OF THE SPEAKERS for'the International panel will be Chris-tian Gronroos, Swedish School ofEconomics and Business Administra-tion, and Barbara R. Lewis, Universi"ty of Manchester Institute of Scienceand Technology.

The sessions on the marketing ofprofessional services also will providemany interesting viewpoints, accord-ing to track chairperson Paul N.Bloom, Marketing Science Instituteand University of Maryland. Amongthe presenters at these sessions will beindividuals who have considerableexperience in consulting to profes-sional orgahizations, he said.

A session titled "Evaluating theMarketing of Professional Services"will describe how American societyhas bee.n affected by the increased useof marketing by professionals, Bloomsaid.

Another session, "Strategies forMarketing' Professional Services,

William R. George Christopher Lovelocic

Robert Catiin IMIchaei Rothschild

^ ^ architects, and other profes-sionals ofthe real world," Bloom said.' papers covering heahh care, educa-tion and arts, and theoretical aspectsof marketing aqross nonbusinessareas will be featured in the PublicSector/Nonprofit Services tract, ac-cording to track chairman Michael L.Rothschild, University of Wisconsin.

The Commercial Services Trackhas sessions ranging from concept to

empirical resear(;h on-flnancial ser-vices, restaurants, catalogue shoppers,equipment leasing, and organization-al structure in service firms, said trackchairman Lynn Shostack, Citibank,

Key commercial service sessions, hesaid, relate to the benefits and limits oftraditional goods-oriented tech-niques/concepts^ -and the develop-ment of the marketing discipline infinancial services firms.

THE SERVICES THEORY track,chaired, by Christopher Lovelock,*Harvard University,-xontaias avariety of coqapetitive papers.

An "Environment of Services Mar-keting" session includes a look at theFederal Trade Commission's regula-tion of services and services' role instagflation.

Another session, "Consumer Be-havior in Evaluating and SelectingServices," includes an analysis of ser-vices advertising and the hierarchy ef-fect, as. well as a consumption/ evalua-tion process model for services.

"Managing^the Marketing Func-tion in Service Firms" is a session thatwill consider organizational issuesand the communications componentof the services marketing mix. In the"Conceptualizing the Goods vs. Ser-vice Dichotomy" session, classifica-tion issues and-human capital theorywill be discussed.

An optional tour of Disney Worldwill be offered on Tuesday afternoon,Donnelly said. For more information,see the Conference Calendar in thisissue. _

^ Wocniitingwill feature papers that touch on var-ious strate^c approaches that profes-sionals can use to improve their mar-keting programs, he said.

The final session, "The Practition-ers Speak on the N^rketingof Profes-sional Services," will include papersby full-time practitioners. "It will giveconference pactici pants a Teenng othow 'classcoem^artceting is workingioFdoctors, lawyer^, derttists, accoun-

CAREER 6UIDANCE-MANACSEMENT SELECTION. specialists for marifeting peofiie with co|if^ degrees.

aiRl other advancof or tedmicandegrees iiltis somepractice business experience.

RRYANT & RAKiWELLV John Hancock'Suite 1532, 875 N. Michigan

Chicago, liiinois 00011Write or call 312/649-0700

(a) having available ot

production capacity and

(b) .id>(eriisinq and oiher

exhibit 1Relatidnjship between market share and pretax ROI

ROI

30%

20

10

0

Under 10% 10-20°b 20-30 So '

-

30-40 "b Q\iex 40%

Market Shar*

MarketShare (%)60

ExhibH3

O " » . - - -20

Awareness (%) .

Question -asker, or

interviewer?. what a difference!

Every feasiblemeasure of qualitycontrol is built into anNFO telephone survey. Our intervie^wers arepermaneTit and take corporate pride in their work.Training is intense and continuous. Briefings and —rehearsal-are thorough. Performance and productionstahdards are strict and^e constantly monitored andreviewed. Editors go over every completedquestionnaire before it is released from the ..idepartment.

The result is a staff of experienced and confident-interviewers (over 150 of them) who know how tomaintain rapport and stilj keep an interview on trackwithout rudeness; how to keep a respondentinterested to the end of the interview; how to workaround switchboard operators and secretaries to reachindustrial respondents.

In an NFO telephone survey the most criticalelement is assured — professionalexecutjon^all us at I 4 1 9 ) J 6 6 6 - 8 8 0 0 ,

A

NAtioNAL EAM!LY OPINION,

top related