Brand Asset

Management
David Scott (2000)
 Brands
Brands are assets. Brand power is the
alternative to price competition. –David A.
Aaker

A strong brand is the only alternative to

destructive price competition.

The customer loyalty needs to be based

not on price but on points of
differentiation, including brand personality,
intangibles, emotional benefits, and self-
expressive benefits.
 Brands
The white T-shirt, which is
100% cotton and of the
highest quality can sell for
$3 or for $30.

It can be sold in a deep-

discount retail store or a
high-end, prestigious
boutique.

How much that white T-

shirt costs and where it is
sold is directly linked to
the brand name stitched
inside its collar!
 What is a Brand?
A brand is an intangible component of
what a company stands for.

A consumer generally doesn’t have a

relationship with a product or a service,
but he or she may have a relationship with
a brand.

In part, a brand is a set of promises. It

implies trust, consistency and a defined set
of expectations.
 What is a Brand?
The strongest brands in the world own a place in
the consumer’s mind, and when they are
mentioned almost everyone thinks of the same
things.

3M invokes innovation, FedEx means guaranteed

delivery, Disney means family entertainment and
individual performance connects often will
connect you to Nike.

A brand differentiates products and services that

appear similar in features, attributes, and
possible even benefits.
 What is a Brand?
What makes leading brands better is the PATH they
travel in the human mind. PATH is an acronym for
Promise, Acceptance, Trust, and Hope. This PATH
is intangible and can be emotional.

Can you actually buy PATH?

Yes, a strong brand makes these intangibles tangible

in the consumer’s mind.

A brand is about confidence and security. Brands

help consumers cut through the proliferation of
choices available in every product and service
category.
Who owns the Brand?
The customer’s knowledge and perception
of the brand will be formed by every
manager’s and employee’s actions,
behaviors, activities, and contacts.

The brand is owned and should be

managed by every employee in the
organization.
 Benefits of having a
strong brand
Loyalty drives repeat business.

Brand-based price premiums allow for higher

margins.

Strong brands lend immediate credibility to new

product introductions.

Strong brands allow for greater shareholder and

stakeholder returns.

Strong brands embody a clear, valued, and

sustainable point of differentiation relative to the
competition.
 Benefits of having a
strong brand
The more loyal the customer base and the
stronger the brand, the more likely
customers will be forgiving if a company
makes a mistake.

Brand strength is a lever for attracting the

best employees and keeping satisfied
employees.

70% of customers want to use a brand to

guide their purchase decision.
 Benefits of having a
strong brand
Loyalty implies CHOICE.

Customer retention is not the same as

customer loyalty. A person may choose a
brand simply because it’s the only one
available at that time at that place but
once the preferred brand is available, a
loyal customer chooses that brand (even
when it’s expensive, i.e. Starbucks).
 A new approach in
managing brands
Traditional Brand Management Brand Asset
Management Strategy
Brand management Brand asset management strategy
Brand managers  Brand champions and
ambassadors
Retention  Deep loyalty
One-time transactions  Lifetime relationships
Customer satisfaction  Customer commitment
Product-driven revenues  Brand-driven revenues
Three-month focus  Three-year focus
Market share gains  Stock price gains
Marketing manages the brand  All functional areas
manage the brand
Why would a consumer
leave a brand?
Brand switching triggers:
Brand failed to deliver its promise (52%)
Brand was not available (52%)
Brand no longer met needs (42%)
Another brand was recommended (41%)

The point is – you control your own destiny.

An overview of Brand
Asset Management
Basic BAM approach
 the process
involves four phases
and eleven steps.
Phase One: Developing
a Brand Vision
Step 1: define the strategic and financial goals
and objectives that your brand should help
achieve

How well does your Brand Vision link to the

corporate vision?

What financial growth gap (the difference between

revenues and earnings today and desired revenues
and earnings 3-5 years from now) are you trying to
fill?

Does senior management agree on the goals and

objectives for the brand?
Phase One: Developing
a Brand Vision
Example of a Brand Vision for a leading eye care
company:

Around the world, our eye care brand will stand

for leadership in visual care. Consumers and the
professional channel will recognize us as the
industry leader in visual care solutions, including
the best service, follow-up, expertise, and
product innovation. Our brand will help us to fill
one-third of our stated financial growth gap
through price premiums, better relationships
with the channel, and close-in brand extensions.
Phase One: Developing
a Brand Vision
The key to successful Brand Vision is to
discuss the implications behind every word
in the vision.

Without the Brand Vision you might go off

in many different directions, without
knowing which one is the right one. The
Brand Vision enables you to execute the
brand strategy and, ultimately, may be a
way to achieve the corporate vision. –
Vicky Shire, VP marketing at Nicor, Inc.
Phase Two: Determining
your BrandPicture
Purpose of this phase is to understand
customer perceptions and perspectives about
your brand relative to the competition and
opportunities for growth.

Step Two: Determine Your Brand’s Image

Develop a full understanding of your brand’s
image in the minds of past, present and future
customers. The more positive they are, the
stronger your brand image and the more
leverage you most likely will have in growing
the brand.
Phase Two: Determining
your BrandPicture
Step Three: Creating Your Brand’s Contract
A Brand Contract lists customer perceptions of all the
current promises your brand makes, both positive and
negative, as well as the promises it should make
going forward to maximize customer satisfaction and
happiness.

Step Four: Crafting a Brand-Based Customer

Model
The customer model provides an understanding of how
consumers think and act and why and how they make
purchase decisions. The model uncovers consumer
beliefs about your brand, the category, and the
competition. Here again, perception is reality.
 Phase Three:
Developing a Brand
Asset Management
Strategy
The purpose of this phase is to determine the right brand-
based strategies for achieving the goals and objectives
stated in the Brand Vision and in the market-based
perceptions and perspectives from the BrandPicture.

Step Five: Positioning Your Brand For Success

A strong brand position means having a unique, credible,
sustainable, fitting and valued place in customers’ minds. It
revolves around a benefit set that helps your product or
service stand apart from the competition.
Positioning is more than just a tagline. Positioning helps you
shape your overall strategy.
Once you know how you want to position the brand, it
becomes fairly evident which innovations you should focus on,
what pricing strategy makes the most sense, how best to
leverage distribution channels, and how you should
communicate brand benefits to your target audience.
 Phase Three:
Developing a Brand
Asset Management
Strategy
Step Seven: Communicating your
brand’s positioning
Brand-based communication is about
determining the right mix of communication
vehicles to maximize your potential for
achieving the goals established in the
Brand Vision.
Note: Branding and advertising are not
necessary the same.
 Phase Three:
Developing a Brand
Asset Management
Strategy
Step Six: Extending your brand
Once your positioning is well defined, you
can start to think about the boundaries of
your brand and how far they might be
stretched. Look for those areas that will have
the highest impact on your bottom line, help
to fulfill the Brand Vision, and leverage key
findings resulting from your BrandPicture.
Example: Gillette extended its original men’s
razor line into one for women. Regular
strength Tylenol was extended into extra
strength Tylenol. Gap line was extended to
Baby Gap.
 Phase Three:
Developing a Brand
Asset Management
Strategy
Step Eight: Leveraging your brand to maximize
channel influence
The stronger your brand, the greater your chance of being
able to direct the channel instead of it directing you.

Step Nine: Pricing your brand at a premium

The ability to charge a premium for your brand over that of
the competition is critically important to driving the brand’s
asset value. Your BrandPicture should help you determine
whether your brand allows you to charge a premium price.

For example, Starbucks is the epitome of premium

pricing; it has not only branded a commodity but taken
the lead in pricing that commodity.
 Phase Three:
Developing a Brand
Asset Management
Strategy
There are 8 ways to leverage (strategic advantage) your brand
as an asset:
1. Price your brand at a premium relative to the
competition
2. Launch new products more cheaply than the competition
3. Recoup development costs sooner
4. Lower acquisition costs for new customers
5. Establish loyal customer who continue to pay a premium
6. Use premium pricing to exert greater control over your
channel
7. Use a stronger brand to seek out cobranding and
licensing opportunities
8. Leverage the strong brand across many target segments
to own the category without diluting the value of the
brand
Phase Four: Supporting
a brand asset
management culture
How should we set up our organization to maximize
brand success?

What metrics should we use to evaluate our brand’s

performance?

Step Ten: Measuring your return on brand

investment (ROBI)
Two brand-related metrics that were leveraged
consistently across companies were awareness and
recall. If your ad received high scores on either of these
measures, the brand was deemed a success. However, it
is critical to measure conversion of awareness to
purchase.
Proverbial wisdom is true: you cannot manage what you
cannot measure. The challenge is finding the right set of
metrics to ultimately help you achieve your Brand Vision.
Phase Four: Supporting
a brand asset
management culture
Step Eleven: Establishing a brand-
based culture
A strong brand culture affects the roles of
every functional area, of senior
management, of internal communications,
and of the reward and measurement
systems.
 Brand Definitions
Brand – an intangible but critical component an
organization owns that represents a contract with the
customer, relative to the level of quality and value
delivered tied to a product or service. A customer
cannot have a relationship with a product or
service, but may with a brand.
A brand is a set of consistent promises. It implies
trust, consistency, and a defined set of expectations. A
brand helps customers feel more confident about their
purchase decision. A brand is an asset and, next to your
people, no asset is more important. It is a long term
proposition – a strong brand stays consistent with what
it means for a long time, often decades.
 Brand Definitions
Brand Asset Management – a balanced investment
approach for building the meaning of the brand,
communicating it internally and externally, and
leveraging it to increase brand profitability, brand
asset value, and brand returns over time.

Corporate Branding – a composite of all the

experiences, encounters and perceptions a
customer has with a company. It implies that all
internal and external communications are aimed at
presenting a single, unified message. Corporate
branding strives to build trust in the company,
not in a particular product or service.
 Brand Definitions
Product Branding – branding in which the product or
service is synonymous with the brand. Product branding
allows the consumer to fit product perceptions and brand
image into one and strives to build trust in the brand.

Brand Positioning – the place in consumer’s minds that you

want to own. Specifically, it is the benefit that you want
them to think of when they think of your brand. It has to be
externally driven and relevant. It has to be
differentiated from the competition and most
importantly, it has to be valued.
A good positioning is a single idea to be communicated to
your customers. A good positioning is a credible promise of
value, delivered in ways that distinguish your brand from that
of your competitors. A good positioning is a concise
statement that summarizes your brand’s promise to its
customers.