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Developing, Managing And Growing Brand Equity

Tags: brand

In this blog post, we're going to explore some of the key tools and reasons for actively managing the economic value of a Brand or a portfolio of brands.

The financial worth of a brand is often called its' equity value. The reason being is that it has a measurable impact on the balance sheet of a company.

The key reasons for developing a management system for an organisation's brand equity are as follows:

  1. To clearly communicate internally how important brands are to the success of the organisation.
  2. To counteract short-term tactical thinking.
  3. To encourage better brand decision making.
  4. To reduce bad brand decisions.
  5. To manage personnel turnover and ensure continuity of brand thinking.

1. Brand Charter

In the first step is to define a brand's charter. Here we take a look at what a brand charter is and why it is important.

1.1 Brand Charter Content Elements

A typical charter will contain the following six elements.

1. Importance
Establishing why an organisation's brand is important to them is the first step. This importance can be expressed in marketing terms, sales results and financial health.

For an established company, it can be easy for a newcomer to take long-term brands for granted.

For newer companies, not everyone inside the organisation may grasp the true importance and potential of a successful brand.

2. Scope
Define what are the key brands. Are they product or service based? Is it an organisation wide umbrella brand identity?

How have they been branded and what methods have been used to date to manage them.

3. Actual and Desired Equity
This is a statement of a brand's vision, together with its' current equity value. It goes on to state the perceived potential inherent within the brand.

This potential can be expressed both in terms of its' anticipated longevity and its' capacity for growth.

In the case of a portfolio of multiple brand identities, their hierarchy and relationships also need to be defined.

4. How Brand Equity Is Measured
Brand equity is measured in both qualitative and quantitative terms. These two methods work together to assess both the economic value and intangible value. They also assess the impact a brand is having in the marketplace.

The two main reporting tools for doing this assessment are a brand audit and a brand tracking report. These reports are described more fully in a later part of this blog.

5. Strategic Brand Guidelines
These guidelines advise brand managers on where the brand came from, how it has evolved to date and its' planned trajectory.

The reason behind these guidelines to help to keep the brand on track. For instance, it is possible for a series of short-term tactical actions to deviate a brand from its' core vision. An example might be a drop in sales being met with a price discounting campaign. Many brands are assumed to be price insensitive, so meeting a drop in sales with a pricing tactic might be wholly inappropriate for a brand's market image.

Also, there could be other more important factors at work, which need to be assessed. Such as a general downturn in an economy, changing consumer preferences or a new technology delivery channel.

6. Identity and Styling
The ways in which a brand identity has been styled also need to be documented. These include things such as colour schemes, typography, logos, labelling, approaches to advertising and promotion communications.

Periodically, these may be refreshed. But on the whole, once a brand identity is established with consumers, it needs to be maintained in order to keep the consumer relationship.

In this case of larger companies, with multiple brands, this may become a separate document in its own right.

1.2 Managing The Brand Charter

This document itself needs to be managed, to keep it both relevant and useful. Changes may come about from a brand audit, or from new additions to a brand or from changes in business strategy.

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2. Brand Equity Reports

In this section, we take a look at how to measure and monitor brand equity.

There are several reporting tools available to brand managers. Which ones to use will depend on available resources and the complexity of the brand or brands being monitored.

2.1 Brand Audit Report

This report is often the foundation for understanding a brand and where in the marketplace its' value is coming from. It is used to assess the current health of a brand. It can also indicate sources of equity, as well as give guidance on how to manage different equity sources.

However, this report takes a lot of resources and it is often only done annually.

2.2 Brand Tracking Report

This report is often based on the findings of an organisation's brand audit. It is used to track the empirical movement of key performance indicators, by regularly collecting information from consumers.

There is a wealth of data to measure and analyse. These performance indicators can come from both the product and consumer viewpoints, and include qualitative and quantitative factors.

2.3 Internal Factors

What is going on within a company can also have an important impact on brand performance. For instance, measures of factors such as operational efficiency and resource allocation. In the case of more complex products, raw material prices and the performance of outsourcing partners could also directly impact a brand's performance.

2.4 Market Performance Factors

These measure how well is a brand doing by factors such as market share, sales results and profitability.

2.5 Collating Performance Data

As you can see, there are several sources of data. Some will be held within a marketing department, whilst other data elements will be managed in other departments.

So, one of the key objectives of brand equity reporting, is to bring these different performance indicators together in a consistent form. That way, a more complete picture of a brand's performance can be created and monitored.

This data can be held a different levels of detail, from high level views to more detailed breakdowns. The aim is to not only see what is going on, but also to understand why.

2.6 Report Formats

There are several options for presenting this data. Typical resources include Excel spreadsheets or other data base reports.

Another more recent format is the introductions of dashboard type displays. These aim to allow readers to not only see what is going on, but are also actionable. The advantage of a dashboard system is that is allow multiple data sources to be collated and presented under a single design.

They can also be tailored to allow users to create and modify their own data views.
Clearly dashboard type systems sound attractive, they can also be expensive to implement and to maintain.

3. Brand Equity Responsibilities

In the third of section of this blog, we take a look at how to manage brand equity within an organisation.

3.1 Who's In Control

If an organisation accepts that its' brand or brands are important to it, a question then arises: who is responsible for the integrity and growth of those brands.

This question implies that brand management could be considered as a separate function from general marketing management. Or, at least, a distinct sub-set within its' remit.

In more complex organisations, with many products or services, it is likely that overall control of brand equity would be a distinct business role and stream.

3.2 Roles and Responsibilities

Here are four key brand management roles and their undertakings. (Ref Scott Bradbury)

1. Strategic Thinker
Many brands are often longer-term undertakings, so this role demands that the management team think in terms of at least two to three years ahead. This stops shorter term tactical thinking form diluting a brand, or blowing it off-track.

They need to be deeply familiar with the brand: its' meaning, purpose and identity.

In some organisations, this is known as the brand gatekeeper role.

2. Guardian
This role champions and protects the brand both internally within the organisation, and externally with how it is received in the world.

This introduces us to the concept brand as an internal force within a company. How do employees become passionate advocates of a brand? For Scott M. Davis (see sources) this is a three-fold process of hearing it, believing it and then living it.

This also takes us beyond thinking of a brand as just a product or a service. It is a much wider experience for many consumers, and this in turn touches upon all aspects of how an organisation operates and interacts with them.

3. Architect
A role which involves understanding where a brand has come from, and helping to plan its' future journey. This requires knowing what's going on within a brand, its' competitors and the marketplace.

This knowledge comes from research and being in regular touch with the main brand activists.

4. Voice
Managing the consistency and truth of each brand. This role serves to manage both internal and external brand communication.

This can include activities such as brand design, promotional mediums, corporate reporting and internal training.

3.3 Review Processes

These regular brand meetings seek to monitor and review what is going on within a brand's world. This can cover events such as projects, planned campaigns, new initiatives and materials.

4. Summary

As a reminder, here are the key reasons for developing a management system for an organisation's brand equity:

  1. To clearly communicate internally how important brands are to the success of the organisation.
  2. To counteract short-term tactical thinking.
  3. To encourage better brand decision making.
  4. To reduce bad brand decisions.
  5. To manage personnel turnover and ensure continuity of brand thinking.

And, as we can see, this can be a complex and resource hungry activity, which is only justified by the powerful economic value and potential a brand or brand portfolio has to an organisation.

4. Source References

K.L. Keller, Strategic Brand Management, 4th Edition, Pearson Publishing.
Scott Bradbury - p 312 Keller
Scott M. Davis - p 311 Keller
J.N. Kapferer, Strategic Brand Management, 4th Edition, Kogan Page Publishing.

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andcopy; David R. Durham,
Digital Marketing Education.
Blog: http://brandrefuge.com/



This post first appeared on Digital Bloggers, please read the originial post: here

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Developing, Managing And Growing Brand Equity

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