Brand InEquity – Making Brand Equity Work

August 3, 2010

I recently came across an interesting Q&A with Professor Byron Sharp from the Ehrenberg-Bass Institute for Marketing Science. Byron was commenting on the validity, or lack thereof, of various brand equity measurement approaches: 

Professor Byron Sharp Talks Brand Equity

Interviewer:
But you don’t like these brand tracking services ? 

Byron:
There is an industry that provides special scores on brands, based on surveying customers.  These services mostly claim to be measures of things like brand loyalty or brand equity.  They usually have exotic names like commitment model, brand esteem, brand voltage, brand asset evaluator….Essentially they claim to be able to predict whether the brand is about to gain or lose market share. 

I think any claims made for these proprietary products should be subject to independent examination.  It’s the job of academics to do this testing. Some of the claims are so extraordinary, and so important that they deserve to be checked out.  If they turn out to be true that would be fabulous. 

Interviewer:
And do these proprietary brand health surveys, these metrics, work? 

Byron:
Well that’s just the thing.  No-one knows… 

This is pretty strong stuff. It’s an article of faith for almost all well-trained Marketers that building your brand’s equity is one of the most important things that you can do. But, the question is: is brand equity really important and if so, how are we doing at measuring it? 

How Are Marketers Measuring Brand Equity?

Brand Equity — Important or Not ?

I have to admit, it’s hard to summon any kind of rational argument that Marketers shouldn’t care about brand equity. Fundamentally, Marketing is about understanding consumer needs–articulated or not–and then delivering and communicating products and services that meet these needs better than competitors. 

If this is the core of Marketing, then it’s self-evident that brands will want to stand for the equities associated with the consumer need and how their brand addresses it better than competition. Can anyone seriously argue this point? I think not. Rather, I think Professor Sharpe’s point is not that brand equity is unimportant, but that people are just not very good at measuring it. 

Brand Measurement: Linking Equity & Consumer Need

What’s Wrong With Equity Measurement

As Professor Sharp points out, there are many different approaches to measuring brand equity or brand health. But, I have two fundamental issues with virtually all of them: 

  1. How Advertising & Media Exposure Impacts Brand Equity — On the front end, Marketers develop advertising and other communications programs to convince consumers that their brand is better than competitors. Hence, they need to understand whether and how these programs are working. Only by understanding this can they optimize advertising and media plans to improve equity impact. Currently, equity surveys generally tell us whether equity scores went up, down or were flat. But, as for what caused the changes, who knows? There’s no easy way today to see the cause and effect relationship between advertising and media exposure and changes in brand equity.
  2. How Brand Equity Impacts Business Results — On the back end, wouldn’t it be great to know that there’s  actually a relationship between brand equity and business results? It’s just assumed by most CMO’s that higher equity scores are better. I too assume they are, but then where’s the evidence? What’s needed is a more direct cause and effect quantification of how changes in brand equity actually cause changes in sales or market share. This would go a long way toward helping inform the debate that CMO’s often have with their CEO’s and CFO’s as to the value of “brand” marketing. And today, this is sorely lacking.

Brand Equity & Market Share

What’s Needed: An End-to-End System

In talking to many senior level Marketers, I hear over and over again that people are looking for an end-to-end system that links key communication and business metrics together. They want to: 

  • Link copy testing scores to real-time in-market tracking of advertising and media effectiveness
  • Connect in-market tracking results to brand equity scores
  • Have brand equity metrics that connect to revenue and share outcomes

CMO's: Chartering The Path From Brand Equity to Business Results

End-to-End Communications — Just a Dream ?

Is this kind of system possible ? Time will tell, but I think it’s within sight. The advent of single source panels which connect what people watch and what people buy at the household level offer tantalizing possibilities.

Until then, Marketers should continue to focus on building brand equity, but keep in mind that higher equity scores are not an end in and of themselves. They ultimately need to drive better business results–otherwise who really cares about brand building? 

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Brand Salience – Why It Matters for Your Brand

February 22, 2010
Woody Allen once said that “80 percent of success is just showing up .” Unfortunately, at purchase decision time, the vast majority of brands never show up at all. Getting consumers to “think” about your brand more often, and in more buying situations, is one of the most under-rated marketing challenges that brands face today.

Brand Salience — What is It?

Brand Salience is the degree to which your brand is thought about or noticed when a customer is in a buying situation. Strong brands have high Brand Salience and weak brands have little or none.  This helps explain to some degree why big brands are big and small brands are small: if no one thinks about you at the moment of buying truth, your brand is going to be relegated to the dustbin of small and unnoticed brands.

Moment of Truth - Does Your Brand Have Salience ?

Brand Salience IS NOT the same thing as top of mind awareness. Top of mind awareness is simply what brands come to mind when consumers are asked to recall brands within a category. Brand Salience is different. Why? Because it is what brands come to mind when consumers are in a purchase situation. More specifically, Brand Salience is the memory of your brand and its linkage to other important memory structures. The buying situation “mindfulness” and linkage to memory structures is what differentiates Brand Salience from top of mind awareness.

What Drives Brand Salience

This all sounds very simple. But there really is some science behind it. Jenni Romaniuk and Byron Sharp of the Ehrenberg-Bass Institute for Marketing Science have done research into Brand Salience, and the findings are surprisingly simple, yet counter-intuitive, for Marketers. Brand Salience is a function of the quantity and quality of the consumers memory structures. Brand Salience is the step before consideration–is your brand even “thought of” before the consumer considers a brand or brands and makes a final purchase decision? Or is it mentally screened-out, like the majority of brands?

1.  Quantity Of Memory Structures

In buying situations, consumers are often driven by mental “cues” that trigger their thoughts around brand consideration sets. For example, if I’m thinking about getting a quick meal for under $5, I’m likely to consider Subway based on their ubiquitous “$5 Foot Long” campaign.

Subway $5 Footlong - Building Brand Salience

Or, if I want to eat something “fresh and healthy,” then I’m also likely to think of Subway given their focus on fresh and healthy eating. The more memory structures your brand is linked to, the more salient your brand–e.g. the more likely it is to be thought of during a buying situation. The examples above point out something important: what buyers remember about brands isn’t always the same across buying decisions. So, the quantity of memory structures can make a difference.

2.  Quality of Memory Structures

Romaniuk and Sharp argue that the quality of Brand Salience is a function of the strength of the association and the attribute relevance.  Taking the Subway example above: because I’ve seen so many $5 dollar foot long creative executions, the linkage is very strong. Additionally, if value is important and relevant to me because I’m on a budget, this further increases Brand Salience.

So, to summarize:  Brand Salience is a function of: a) the quantity of memory structures your brand is linked to; and b) the quality of these structures, as defined by the strength of association and relevance of the structure. By building the quantity and quality of memory structures, you maximize the number of consumers who will think of your brand and the number of times they think of your brand in various buying situations. So, in Woody Allen parlance, your brand “shows up.”

Brand Salience vs. Brand Equity — A Conflict?

If you grew up in traditional CPG brand management like me, you were trained to believe that a brand should define its equity and rigorously and relentlessly focus on communicating it without deviation. I still recall senior P&G managers speaking scornfully of advertising which was “off-brand.” On the other hand, Brand Salience sounds a bit like a license for freelance communication–equity be damned.

There needn’t be a conflict. Marketers need to consider two approaches to building Brand Salience:

1.  Focus on Defining and Communicating Different Cues Against A Common Equity – Assuming you’ve defined a focused and important equity for your brand, you need to do the consumer research to understand the most important and relevant cues which link to your benefit. Then, having defined these, brands need to execute creatively against these cues to maximize the number of memory structure associations.

Subway Fresh & Healthy - Building Brand Salience

For example, Subway’s “fresh and healthy” positioning can be executed via a range of cues like “good for my kids,” “for people on diets,” “good for outdoor activities,” etc. These are all different cues that may lead to a consumer considering Subway for a “fresh and healthy” offering.

2.  Create and Own Distinctive Executional Memory Structures – A second approach is to increase the quantity and quality of executional memory structures. For example, the Subway logo, usage of the Jared Fogle character, the $5 dollar foot long music, etc. are all examples of creating executional memory structures. These executional memory structures help create a platform that enables consumers to more easily remember your brand in buying situations.

Subway's Jared Fogle - An Executional Equity

So, Brand Salience is an important but often ignored challenge for Marketers. Do your brand a favor. Listen to Woody Allen. Make sure that your brand “shows up” and is salient — a very important step in ensuring your brand gets considered for purchase.

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