Author's Note: Quick Bites is a series of write-ups on various marketing concepts. I decided to come up with this series to help people understand these concepts better through a few easy to read posts. Any comments or suggestions for the next topic are welcome. Cheers!
“The power of a brand lies in the minds of consumers”
Brand equity reflects the real value the consumers associate with a brand. This is the reason why branded products charge a higher premium than generic or store products. It is the framework that deals with the emotional and functional (credibility in terms of product quality) associations the consumers have with the product. It has both tangible and intangible aspects associated with it.
Consumer-based Brand Equity (CBBE)
The major conceptual dimensions associated with consumer-based brand equity are brand awareness, brand associations, perceived quality, brand loyalty, and other proprietary brand assets such as patents, trademarks and channel relationships. These provide a differential effect in lieu of the brand knowledge on consumer response. This also helps to explain how consumers will react to the different marketing mix during the different decision-making stages.
Five Dimensions of Brand Equity (Aaker's model of Brand Equity)
1. Brand Awareness
It is defined as the customers’ ability to recall and recognise a brand. It identified the level of awareness for the brand. Can be measured through top-of-the-mind associations (TOMA).
2. Brand Associations
Brand Associations represents the images and symbols with which consumers relate a brand. These are not usually functional but rather emotional in their appeal. These associations might be taglines, images, jingles or mere words. These are not reasons to buy but these are the differentiators that support a brands claim or helps them gain the customer mind share. Examples are Britannia’s signature tune ‘Ting-ting-ta-ding”, TATA Group’s association with the word Integrity.
3. Brand Loyalty
It is defined by the attachment a customer has with a brand. Quantified through the number of repeat purchases or Brand recalls.
4. Perceived Quality
Perceived quality is the customer’s judgment about a product’s overall excellence or superiority that is different from objective quality which refers to the technical, measurable and verifiable nature of products/services, processes and quality controls.
5. Other proprietary measures
These usually comprise of the competitive advantage the brand possesses with respect to the other players in the industry. Ex. patents, Intellectual proprietary rights etc.
Measuring Consumer-based Brand Equity (CBBE)-
1. Direct Approaches
Example: Multi-Attribute Approach - The different attributes of the products are rated/ranked and their importance to the consumers is identified. This helps to identify the brand equity on the basis of the presence or absence or level of the presence of the preferred attributes.
2. Indirect Approaches
A study identified 5 different CBBE dimensions namely performance, value, social image, trustworthiness, and commitment. These dimensions cannot be directly measured and hence, indirect ways such as utilities derived through the brand usage need to be used. These utilities might be ex-post (after the brand purchase) or ex-ante (prior to the purchase) in nature.
Example: Price Premium- It is an outcome variable or proxy that can be used to measure the differential income for a brand over the other brands or generic products.
--------
About the Author:
Priyanka is a second-year MBA student at Indian Institute of Management, Lucknow and is a member of InsideIIM’s second student team. She is also a part of PRiSM, The Marketing Cell at IIM Lucknow.