Brand Equity Models

Although there is agreement about basic principles a number of models of brand equity offer some different perspectives. Here we briefly highlight four of the more established ones.

Brand Asset valuator: advertising agency Young and Rubicam (Y&R) developed a model of brand equity Brand Asset Valuator (BAV) based on research with almost 200,000 consumers in 40 countries. BAV provides comparative measures of the brand equity of thousands brands across hundreds of different categories. There are four key components or pillars of brand equity.

Differentiation measures the degree to which a band is seen as different from others.

Relevance measures the breadth of a brand’s appeal.

Esteem measures how well the brand is regarded ad respected.

Knowledge measures how familiar and intimate consumers are with the brand.

Differentiation and Relevance combine to determine Brand Strength. These two pillars point to the brand’s future value, rather just reflecting its past. Esteem and knowledge together create Brand Stature, which is more of a “report card” on past performance. Examining the relationships among these four dimensions a brand’s pillar pattern reveals much about its current and future status. Brand strength and Brand stature can be combined to form a power Grid that depicts the stages in the cycle of brand development each with its characteristics pillar patterns in successive quadrants. New brands, just after they are launched, show how these levels are on all four pillars. Strong new brands tend to show higher levels of differentiation than Relevance, while both pillars Esteem and Knowledge are lower still. Leadership brands show high levels on all four pillars. Finally, declining brands show high Knowledge evidence of past performance relative to a lower of Esteem, and even lower Relevance and Differentiations.

Former UC-Berkeley marketing professor David Aaker views brand equity as a set of five categories of brand assets and liabilities linked to a brand that add to or subtract from the value provided by a product or services to a firm and/or to that firm’s customers. These categories of brand assets are: (1) brand loyalty, (2) brand awareness, (3) perceived quality, (4) brand associations, and (5) other proprietary assets such as patents, trademarks, and channel relationships.

A particularly Important concept for building brand equity is brand identity the unique set of brand associations that represent what the brand stands for and promises to customers. Aaker sees brand identify as consisting of 12 dimensions organized around 4 perspectives: brand-as-product (product scope, product attributes, quality / value, uses, users country of origin); brand-as-organization (organizational attributes, local versus global); brand–as-person (brand personality, brand customer relationships); and brand-as-symbol (visual imagery / metaphors and brand heritage).

Brand identity is also conceptualized as a core and an extended identity. The core identity – the central, timeless essence of the brand is most likely to remain constant as the brand travels to new markets and products. The extended identity includes various brand identity elements, organized into cohesive and meaningful groups. If we apply this approach to Saturn, the newer General Motors car division might yield the following:

Core identity: A world-class car with employees who treat customers with respect and as friends.

Extended Identity: US subcompact with Spring Hill, Tennessee plant; no pressure, no haggling, informative retail experience; thoughtful, friendly down-to-earth, youthful and lively personality; committed employees and loyal users.

BRANDZ: marketing research consultants Millward Brown and WPP have developed the BRANDZ model of brand strength, at the heart of which is the Brand Dynamics pyramid. According to this model, brand building involves a sequential series of steps, where each step is contingent upon successfully accomplishing the pervious step. The objectives at each step, in ascending order, are as follows:

1. Presence; Do I know about it?
2. Relevance: Does it offer me something?
3. Performance: Can it deliver?
4. Advantage: Does it offer something better than others?
5. Bonding: Nothing else beats it.

Research has shown the bonded consumers, those at the top level of the pyramid, build stronger relationship with the brand ad spend more of their category expenditures on the band than those a lower levels of the pyramid. More consumers, however, will be found at the lower levels. The challenge for marketers is to develop activities and programs that help consumers move up the pyramid.

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