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  • 8/13/2019 BVM CASE

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    DEVELOPING A BRAND EQUITY MEASUREMENT AND

    MANAGEMENT SYSTEM

    Hunny Goyal (14)

    Nilay Thakkar (51)

    Parth Shah (44)

    8.1

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    The Brand Value Chain

    Broader perspective than just theCBBE model

    The brand value chain is a structured

    approach to assessing the sourcesand outcomes of brand equity and the

    manner by which marketing activities

    create brand value.

    8.2

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    The Brand Value Chain

    The brand value chain has severalbasic premises. Fundamentally, it

    assumes that the value of a brand

    ultimately resides with customers.

    8.3

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    The Brand Value Chain Based on this insight, the model next assumes that the brand

    value creation process begins when the firm invests in a

    marketing program targeting actual or potential customers. The marketing activity associated with the program then affects

    the customer mindset with respect to the brandwhatcustomers know and feel about the brand.

    This mindset, across a broad group of customers, then resultsin certain outcomes for the brand in terms of how it performs inthe marketplacethe collective impact of individual customeractions regarding how much and when they purchase, the pricethat they pay, and so forth.

    Finally, the investment community considers this marketperformance and other factors such as replacement cost andpurchase price in acquisitions to arrive at an assessment ofshareholder value in general and a value of the brand inparticular.

    8.4

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    The Brand Value Chain The model also assumes that a number of linking factors

    intervene between these stages.

    These linking factors determine the extent to which value

    created at one stage transfers or multipliesto the next stage.

    Three sets of multipliers moderate the transfer between the

    marketing program and the subsequent three value stages: the

    program quality multiplier, the marketplace conditions multiplier,

    and the investor sentiment multiplier.

    8.5

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    Brand Value Chain

    Program

    Multiplier

    Marketing

    Program

    Investment

    CustomerMindset

    MarketPerformance

    ShareholderValueVALUE

    STAGES

    - Product

    - Communications

    -Trade-Employee

    - Other

    - Awareness

    - Associations

    - Attitudes- Attachment

    - Activity

    - Price premiums

    - Price elasticity

    - Market share

    - Expansion success

    - Cost structure

    - Profitability

    - Stock price

    - P/E ratio

    - Market capitalization

    Consumer

    MultiplierFILTERS

    -Clarity

    -Relevance

    - Distinctiveness

    - Consistency

    - Channel support

    -Consumer size and profile

    -Competitive reactions

    -Market dynamics

    -Growth potential

    -Risk profile

    -Brand contribution

    Market

    Multiplier

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    Value Stages

    Marketing program investmentAny marketing program that can be attributed to

    brand value development

    Customer mindset In what way have customers been changed as

    a result of the marketing program?

    Market performance

    How do customers respond in the marketplace?

    Shareholder value

    8.7

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    Multipliers Program quality multiplier

    The ability of the marketing program to affect customermindset

    Must be clear, relevant, distinct, and consistent

    Customer multiplier

    The extent to which value created in the minds ofcustomers affects market performance

    It depends on factors such as competitive superiority,channel support, and customer size and profile

    Market multiplier The extent to which the value generated through brand

    market performance is manifested in shareholder value

    It depends on factors such as market dynamics, growthpotential, risk profile, and brand contribution

    8.8

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    Brand Equity Measurement

    System

    A set of research procedures that is

    designed to provide timely, accurate, and

    actionable information for marketers so that

    they can make the best possible tacticaldecisions in the short run and strategic

    decisions in the long run

    8.9

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    Brand Equity Measurement System

    Conducting brand audits

    Developing tracking procedures

    Designing a brand equity management

    system

    8.10

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    Designing Brand Tracking Studies

    Tracking studies involve information

    collected from consumers on a routine

    basis over time

    Often done on a continuous basis

    Provide descriptive and diagnostic information

    8.11

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    What to Track

    Customize tracking surveys to address the

    specific issues faced by the brand

    Product-brand tracking

    Corporate or family brand tracking

    Global tracking

    8.12

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    How to Conduct Tracking Studies

    Who to track (target market)

    When and where to track (how frequently)

    How to interpret brand tracking

    8.13

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    Brand Equity Management System

    A brand equity management systemis aset of organizational processes designed

    to improve the understanding and use of

    the brand equity concept within a firm: Brand equity charter

    Brand equity report

    Brand equity responsibilities

    8.14

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    Brand Equity Charter

    Provides general guidelines to marketingmanagers within the company as well as

    key marketing partners outside the

    company Should be updated annually

    8.15

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    Brand Equity Charter Components

    Define the firms view of the brand equity

    Describe the scope of the key brands

    Specify actual and desired equity for the brand

    Explain how brand equity is measured Suggest how brand equity should be measured

    Outline how marketing programs should be

    devised Specify the proper treatment for the brand in

    terms of trademark usage, packaging, and

    communication

    8.16

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    Brand Equity Report

    Assembles the results of the trackingsurvey and other relevant performance

    measures

    To be developed monthly, quarterly, orannually

    Provides descriptive information as to

    what is happening with the brand as wellas diagnostic information on why it is

    happening

    8.17

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    Brand Equity Report

    In particular, one section of the reportshould summarize consumer perceptions

    on key attribute or benefit associations,

    preferences, and reported behavior asrevealed by the tracking study. Another

    section of the report should include more

    descriptive market level information suchas:

    8.18

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    Brand Equity Report

    1) Product shipments and movementthrough channels of distribution.

    2) Relevant cost breakdowns.

    3) Price and discount schedules whereappropriate.

    4) Sales and market share information

    broken down by relevant factors, e.g.,geographic region, type of retail account

    or customer, etc.

    5) Profit assessments. 8.19

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    Brand Equity Responsibilities

    Organizational responsibilities andprocesses that aim to maximize long-term

    brand equity

    Establish position of VP or Director of EquityManagement to oversee implementation of

    Brand Equity Charter and Reports

    Ensure that, as much as possible,marketing of the brand is done in a way

    that reflects the spirit of the charter and

    the substance of the report8.20

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    Internal Branding

    Internal brand management makes sure that employees and

    partners appreciate and understand basic branding notions and

    how these can affect the equity of the brands that they are

    working with. The ultimate goal is to make everyone in the

    organization, from the CEO to the trainees, to become

    passionate brand advocates. This can be achieved, according

    to Davis, by following a threestep course: Hear It, Believe It,Live It. To get employees to live the brand.

    8.21

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    Brand Assimilation Process-Scott Davis

    Principle 1: Make the Brand Relevant

    Principle 2: Make the Brand AccessiblePrinciple 3: Reinforce the Brand Continuously

    Principle 4: Make Brand Education an Ongoing Program

    Principle 5: Reward On-Brand Behaviors

    Principle 6: Align Hiring Practices

    8.22