Page 268 - Marketing Management

CREATING BRAND EQUITY | CHAPTER 9 245

Marketers should also think of the marketing dollars spent on products and services each year as
investments in consumer brand knowledge. The quality of that investment is the critical factor, not
necessarily the quantity (beyond some threshold amount). It’s actually possible to overspend on
brand building, if money is not spent wisely.
Brand knowledge dictates appropriate future directions for the brand.A brand promise is the mar-
keter’s vision of what the brand must be and do for consumers. Consumers will decide, based on what
they think and feel about the brand, where (and how) they believe the brand should go and grant per-
mission (or not) to any marketing action or program. New-product ventures such as BENGAY aspirin,
Cracker Jack cereal,Frito-Lay lemonade,Fruit of the Loom laundry detergent,and Smucker’s premium
ketchup all failed because consumers found them inappropriate extensions for the brand.

Virgin America After flying for only a few years, Virgin America became
an award-winning airline that passengers adore and that makes money. It is not unusual
for the company to receive e-mails from customers saying they actually wished their
flights lasted longer! Virgin America set out to reinvent the entire travel experience,
starting with an easy-to-use and friendly Web site and check-in. In flight, passengers revel
in Wi-Fi, spacious leather seats, mood lighting, and in-seat food and
beverage ordering through touch-screen panels. Some passengers
remark that Virgin America is like “flying in an iPod or nightclub.”
Without a national TV ad campaign, Virgin America has relied on PR,
word of mouth, social media, and exemplary customer service to
create an extraordinary customer experience and build the brand. As
VP-marketing Porter Gale notes, “Most of the social-media engage-
ment has been responding, listening and connecting with fans, which
is important because it builds loyalty.” 21

Brand Equity Models

Although marketers agree about basic branding principles, a num-
ber of models of brand equity offer some differing perspectives. Here
we highlight three more-established ones.
®
BRANDASSET VALUATOR Advertising agency Young and
Rubicam (Y&R) developed a model of brand equity called the
®
BrandAsset Valuator (BAV). Based on research with almost 800,000
consumers in 51 countries, BAV compares the brand equity of By satisfying unmet consumer
thousands of brands across hundreds of different categories. There are needs with a little bit of flair,
four key components—or pillars—of brand equity, according to BAV (see Figure 9.1): Virgin America has quickly built
a strong brand.
• Energized differentiation measures the degree to which a brand is seen as different from
others, and its perceived momentum and leadership.
• Relevance measures the appropriateness and breadth of a brand’s appeal.
• Esteem measures perceptions of quality and loyalty, or how well the brand is regarded and
respected.
• Knowledge measures how aware and familiar consumers are with the brand.
Energized differentiation and relevance combine to determine brand strength—a leading indicator
that predicts future growth and value. Esteem and knowledge together create brand stature, a
“report card” on past performance and a current indicator of current value.
The relationships among these dimensions—a brand’s “pillar pattern”—reveal much about a
brand’s current and future status. Energized brand strength and brand stature combine to form
the power grid, depicting stages in the cycle of brand development in successive quadrants (see
Figure 9.2). Strong new brands show higher levels of differentiation and energy than rele-
vance, whereas both esteem and knowledge are lower still. Leadership brands show high levels
on all pillars. Finally, declining brands show high knowledge—evidence of past performance—
a lower level of esteem, and even lower relevance, energy, and differentiation.