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Conceptualizing, Measuring, and Managing
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Customer Based Brand Equity
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There have been two general motivations for studying brand equity: -
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1. . financially based motivation to estimate the value of a brand
2. . strategy-based motivation to improve marketing productivity.
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A brand can be defined as “a name, term, sign, symbol, or design, or combination of them which is intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competitors.
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Brand knowledge is conceptualized as consisting of a brand node in memory to which a variety of associations are linked.
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The relevant dimensions that distinguish brand knowledge and affect consumer response are the awareness of the brand (in terms of brand recall and recognition) and the favorability, strength, and uniqueness of the brand associations in consumer memory.
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Brand Awareness:
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Brand recognition relates to consumers’ ability to confirm prior exposure to the brand when given the brand as a cue. In other words, brand recognition requires that consumers conectly discriminate the brand as having been seen or heard previously. Brand recall relates to consumers’ ability to retrieve the brand when given the product category, the needs fulfilled by the category, or some other type of probe as a cue.
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Brand Image:
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Brand image is defined here as perceptions about a brand as reflected by the brand associations held in consumer memory. Along with level of abstraction, brand associations can be classified into three major categories of increasing scope: attributes, benefits, and attitudes.
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Attributes are those descriptive features that characterize a product or service—what a consumer thinks the product or service is or has and what is involved with its purchase or consumption.
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Brand attitudes are defined as consumers’ overall evaluations of a brand (Witkie 1986). Brand attitudes are important because they often form the basis for consumer behavior (e.g., brand choice).
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The different types of brand associations making up the brand image include product-related or non-product-related attributes; functional, experiential, or symbolic benefits; and overall brand attitudes.
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These associations can vary according to their favorability, strength, and uniqueness.
Customer-based brand equity is defined as the differential effect of brand knowledge on consumer response to the marketing of the brand. a brand is said to have positive (negative) customer-based brand equity if consumers react more (less) favorably to the product, price, promotion, or distribution of the brand than they do to the same marketing mix element when it is attributed to a fictitiously named or unnamed version of the product or service.
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Building Customer-Based Brand Equity:
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Building customer-based brand equity requires the creation of a familiar brand that has favorable, strong, and unique brand associations. This can be done both through the initial choice of the brand identities, such as the brand name, logo, or symbol, and through the integration of the brand identities into the supporting marketing program.
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Developing supporting marketing programs:
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Marketing programs are designed to enhance brand awareness and establish favorable, strong, and unique brand associations in memory so that consumers purchase the product or service. Brand awareness is related to brand familiarity.
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Measuring Customer-Based Brand Equity:
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There are two basic approaches to measuring customer based brand equity. The “indirect” approach attempts to assess potential sources of customer-based brand equity by measuring brand knowledge (i.e., brand awareness and brand image). The “direct” approach attempts to measure customer-based brand equity more directly by assessing the impact of brand knowledge on consumer response to different elements of the firm’s marketing program. The indirect and direct approaches to measuring customer-based brand equity are complementary and should be used together.
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Managing Customer-Based Brand Equity:
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- 1. marketers should adopt a broad view of marketing decisions.
- 2. marketers should define the knowledge structures that they would like to create in the minds of consumers—that is, by specifying desired levels of awareness and favorability, strength, and uniqueness of product- and non-product-related attributes; functional, experiential, and symbolic benefits; and overall attitudes.
- 3. marketers should evaluate the increasingly large number of tactical options available to create these knowledge structures, especially in terms of various marketing communication alternatives.
- 4. marketers should take a long-term view of marketing decisions.
- 5. marketers should employ tracking studies to measure consumer knowledge structures over time to: -
- (1) detect any changes in the different dimensions of brand knowledge and
- (2) suggest how these changes might be related to the effectiveness of different marketing mix actions.
- 6. They should evaluate potential extension candidates for their viability and possible feedback effects on core brand image.
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Conclusions:
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- 1. First, factors influencing the favorability, strength, and uniqueness of brand associations, a focus of much past
- research, should continue to be explored, but along several different lines.
- 2. the costs and benefits of leveraging secondary associations should be explored. For example, how and under what conditions should a firm increase the salience of source factors related to the brand (i.e., the company, country of origin, and distribution channel)?
- 3. One important research priority is to develop valid benchmarks for the direct approach to measuring customer-based brand equity—that is, plausible descriptions of the relevant activity (advertising, promotion, product, pricing, etc.) with no or fictitious brand identification.
- 4. Finally, broader implications of customer-based brand equity should be explored by considering aggregation
- issues associated with brand knowledge effects on market segments or the customer franchise as a whole, as opposed to effects on an individual consumer.
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