Building, Measuring and

Managing Brand Equity

Chapter 2
Learning Outcomes
 Define customer-based brand equity.
 Draw, label and discuss the customer based

brand equity model.

 Outline the sources and outcomes of

customer based brand equity.

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Equity Definition
 the quality of being fair or impartial; fairness;
impartiality.

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Brand Equity Definition
 Brand equity is a phrase used in the marketing industry
which describes the value of having a well-known
brand name, based on the idea that the owner of a well-
known brand name can generate more money from
products with that brand name than from products with
a less well known name, as consumers believe that a
product with a well-known name is better than products
with less well-known names. (From Wikipedia).

 Examples
Brand equity is created through aggressive mass
marketing campaigns.

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Customer-Based Brand Equity

 “The differential effect that brand knowledge

has on consumer response to the marketing of
that brand.”

Keller, 2013

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Customer-Based Brand Equity
 Differential effect
◦ Differences in consumer response
 Brand knowledge
◦ A result of consumers’ knowledge about the brand
 Consumer response to marketing
◦ Choice of a brand
◦ Recall of copy points from an ad
◦ Response to a sales promotion
◦ Evaluations of a proposed brand extension

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Rationale of
Customer-Based Brand Equity Model

 Basic premise: Power of a brand resides in the

minds of customers
 Challenge is to ensure customers have the right
types of experiences with products and their
marketing programs to create the right brand
knowledge structures:
◦ Thoughts
◦ Feelings
◦ Images
◦ Perceptions
◦ Attitudes

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Building
Customer-Based Brand Equity

 Building a strong brand involves a series of steps as part

of a “branding ladder”
 A strong brand is also characterized by a logically
constructed set of brand “building blocks.”
◦ Identifies areas of strength and weakness
◦ Provides guidance to marketing activities

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CUSTOMER-BASED BRAND EQUITY MODEL

4.4. RELATIONSHIPS
RELATIONSHIPS ==
RESONANCE What
Whatabout
aboutyou
you&&me?
me?

3.3. RESPONSE
RESPONSE ==
JUDGMENTS FEELINGS What
Whatabout
aboutyou?
you?

2.2. MEANING
MEANING ==
PERFORMANCE IMAGERY What
Whatare
areyou?
you?

1.1. IDENTITY
IDENTITY ==
SALIENCE
Who
Whoare
areyou?
you?

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Salience Dimensions

 Depth of brand awareness

◦ Ease of recognition & recall
◦ Strength & clarity of category membership
 Breadth of brand awareness
◦ Purchase consideration
◦ Consumption consideration

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Depth and Breadth Importance
 not only the depth of awareness matters but
also the breadth.
 The brand must not only be top-of-mind and

have sufficient “mind share,” but it must also

do so at the right times and places.

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Performance Dimensions

 Primary characteristics & supplementary features

 Product reliability, durability, and serviceability
 Service effectiveness, efficiency, and empathy
 Style and design

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Imagery Dimensions
 User profiles
◦ Demographic & psychographic characteristics
◦ Actual or aspirational
◦ Group perceptions -- popularity
 Purchase & usage situations
◦ Type of channel, specific stores, ease of purchase
◦ Time (day, week, month, year, etc.), location, and context of usage
 Personality & values
◦ Sincerity, excitement, competence, sophistication, & ruggedness
 History, heritage, & experiences
◦ Nostalgia (homesickness)
◦ Memories

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Judgment Dimensions
 Brand quality  Brand consideration
◦ Value ◦ Relevance
◦ Satisfaction  Brand superiority
 Brand credibility ◦ Differentiation
◦ Expertise
◦ Trustworthiness
◦ Likeability

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Feelings Dimensions

 Warmth
 Fun
 Excitement
 Security
 Social approval
 Self-respect

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Resonance Dimensions
 Behavioral loyalty
◦ Frequency and amount of repeat purchases
 Attitudinal attachment
◦ Love brand (favorite possessions; “a little
pleasure”)
◦ Proud of brand
 Sense of community
◦ Kinship
◦ Affiliation
 Active engagement
◦ Seek information
◦ Join club
◦ Visit website, chat rooms

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Making a Brand Strong:
Brand Knowledge
 Brand knowledge is the key to creating brand
equity.
 “the power of a brand lies in what resides in

the minds and hearts of customers”.

 Brand knowledge has two components: brand

awareness and brand image.

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Sources of Brand Equity
 Brand awareness
◦ Brand recognition
◦ Brand recall
 Brand image
◦ Strong, favorable, and unique brand associations

2.
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Brand Awareness Advantages
 Learning advantages
◦ Register the brand in the minds of consumers
 Consideration advantages
◦ Likelihood that the brand will be a member of the
consideration set
 Choice advantages
◦ Affect choices among brands in the consideration
set

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Establishing Brand Awareness
 Increasing the familiarity of the brand
through repeated exposure (for brand
recognition)
 Forging strong associations with the

appropriate product category or other

relevant purchase or consumption cues (for
brand recall)

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Creating a Positive Brand Image
 Brand Associations
◦ Does not matter which source of brand association
◦ Need to be favorable, strong, and unique
◦ Marketers should recognize the influence of these
other sources of information by both managing
them as well as possible and by adequately
accounting for them in designing communication
strategies.

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The Four Steps of Brand Building
1. Ensure identification of the brand with
customers and an association of the brand
in customers’ minds
2. Establish the totality of brand meaning in
the minds of consumers
3. Elicit the proper customer responses to the
brand identification and brand meaning
4. Convert brand response to create an
intense, active loyalty relationship between
customers and the brand

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Four Questions Customers ask of
Brands
1. Who are you? (brand identity)
2. What are you? (brand meaning)
3. What about you? What do I think or feel
about you? (brand responses)
4. What about you and me? What kind of
association and how much of a connection
would I like to have with you? (brand
relationships)

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