Brand Equity

Most extensively used term in business is Brand Equity. We must understand that equity comes later, the brand comes first. In order to have equity, you must have a brand.If there is no brand, there is no equity. As we have already observed in brand image discussion, a brand has a whole trail of associations with it. A brand name acts as a cue to trigger these associations.Customers respond to brands in a discriminative manner. They are ready to pay a premium for the brand. This is on account of the associations pertaining to the brand in the mind space of the consumers or the existing brand image or proposed brand identity.When these responses of the customers to the image and identity are converted into money terms, it represents its financial worth or equity.This draws customers to the brand on a sustained basis.In other words, this loyalty ofthe customers to the brand forms customer equity.The key driver of  brand equity the brand image. Customer attitudes do contribute to the brand equity.Brand associations are embedded in the information nodes of the human brain.To a customer brand equity  is the outcome of a strong positive brand attitude dependent on the beliefs and meanings accessible from memory when activated.

To Upshaw, brand equity represents the total accumulated value or worth of a brand. Konapp(2000) considers brand equity is totality of brand’s perception. Keller (1993) defines brand equity in terms of  marketing effects whereby certain outcomes occur as a result of brand name, and these would not have occured, had there been no brand name.

Brand Names as Short-hand Devices

Brand names evoke a lot of clues, thereby reducing the need for a detailed information search. Miller (1956) has proposed that human mind processes information in terms of’ bits  just like computers. But unlike a computer, human mind can process seven bits of information only simultaneously. Even information carried by a branded grocery items on its package is in hundreds of bits. There is bombardment of information from all sides. Suitable methods must be devised to cope with such a huge amount of information.

Bits of information are, therefore, aggregated into larger groups or ‘ chunks ‘. A label reveals several ingredients which constitute a product. These could be chunked together as ingredients. Price information is combined with this chunk to be interpreted as a high quality offering. Later a brand  name is seen, but it is not familiar. Then the company making it becomes known. This is related to earlier chunks to infer that this is a premium brand. The entire information now emerges as a well-presented container of a quality product priced highly and selling through a reputed retailer and made by well-known manufactuer noted for his promotion. When we come across an ad for the brand, we are able to recall all this information quickly. Brand name evokes an information chunk stored in the memory.

Marketers have to facilitate this process. They have to see that larger chunks of information sink into consumer memory. Such chunks can be quickly accessed through associations from brand names. Branding is thus a short-hand device. Frequent exposure to ads facilitate the chunking process either by active or passing acquisition of information. It is no use repeating the brand name, without associating appropriate attributes with it.

Contextualised Consumer Needs — Need-States

Wedny Gordon’s (1994) research work contends that brands satisfy consumer needs in a specific context, which she calls need-states. Consumers’ use of brands is both need-specific and situation-specific. A housewife may have changing need-states while using coffee.She can serve special Nescafe Gold to her husband’s colleagues. In day-to-day use, she depends on coffee-beans, being ground at home to prepare coffee for the breakfast. When her husband has to hasten to the attend the urgent office work, she uses Nescafe Classic instant coffee.She may like to give chicory-mixed coffee to her group of friends to economise. During travels, she uses coffee sachets which prepare a single cup within no time. In tropical summers, she prefers cold coffee.During her outings, she visits coffee outlets like Cafe Coffee Day or Starbucks, and opts for cappuccino.This example awakens us to the reality that brand loyalty has to be re-considered. A consumer has a repertoire of brands in a particular product category and keeps on switching amongst these brands. Such consumers are not disloyal  as such.Instead, it shows their discernment. They choose brands to satisfy their need-states. Most consumers manifest such behaviour. There could be more differences between one consumer buying on two different occasions than between two consumers buying a brand on the same occasion.

Generic Brand Names

Commodities are branded to distinguish  them from other competing commodities from others. Branding makes these distinct. However, when a brand name becomes too popular, there is a risk of it getting commoditized once again.In other words, it becomes generic.

A brand name should be used just like a brand name. If we use it like a noun or a verb, there is this danger of losing it. We have to say, get the document photocopied, rather than get it xeroxed.Once the brand name becomes generic, we will not be able to protect it. Even while choosing a brand name, a distictive name must be chosen, rather than a name like Super Glue or Windsurfer which are difficult to protect.

Brand Names in Translation — Are They Appropriate ?

Chevrolet had some years ago a strong brand name auto, the Nova. In the East European markets, it was poorly received. The reason being  No Va meant don’t go.It is ridiculous for an auto to have such a brand name.

Rubbermaid, a strong US brand, was ridiculed in the UK  as it connoted sex toys. Grand Teton, a mountain terrain bike in the US, was a good name, though in French speaking countries, it became an embarrassment where its literal meaning was the size of a woman’s breasts.

Brand managers must ensure that the brand name translates appropriately in different countries and different languages.

Jazz Musician and Jingle Composer — Louis Banks

Louis Banks  stays in Santacruz, Mumbai. He has his music studio there. Louis is 73 ( 2014 ) now. He has 31-years old son Gino. Gino has taken up drums. Louis himself is the finest pianist. Both of them play togethter . Louis used to perform all over the world in the 1980’s. Bank’s musical lineage spans six generations, with some members having performed for Nepal’s royal family. They are Nepalis. In the early 1940s, his dad was invited to perform in Kolkata, and then settled there. His father Pushkar Bahadur changed his name to George Banks. This went well with the American jazz band. His son Dambar Bahadur Budaprithi was renamed Louis Banks, after legendary jazz musician Louis Armstrong. He later moved from Kolkata to Darjeeling, and learnt piano and trumpet. His parents moved back to Kathmandu, and Louis became a teacher. He got an offer to play at Kathmandu hotel. Later, a few Kolkata hotels invited him to play. He made Kolkata his home, and formed Louis Banks Brotherhood. R.D. burman heard him there , and offered him Shashi Kapoor’s Mukti in mid-70s. He continued in Kolkata, but the music was fading there. He shifted to Mumbai and played music at Sea Rock, Bandra. He used to work with R.D. Burman. He dropped out of Hindi films once he started to compose advertising jingles. His most memorable composition was Miley sur mera tumhara. His wife is Loraine. Louis has formed new group Reality. He has notebooks where he has written his music, some of these date back to the 1970s. They find Hindi film music okay, but it does not allow alternative music to come up. They sell music CDs at the concerts. People do not buy music from the music stores. Jazz and classical music has  lost audience. It is cultural bankruptcy.

Common Retailing Pitfalls

Some of the negative shopping experiences or retailing pitfalls put off the customers.

  • Trolley Troubles There are no trolleys available for the customer at the entry level. Or the trolleys are defective.
  • Crowded Aisles The aisles are blocked by the merchandise waiting to be put on the shelves.
  • Unclean Surroundings The floors may have waste littered. They may be dirty or stained.
  • Music Loud music or FM is played. Music should be customised to customer profile.
  • Poor Light Poorly lit stores are unwelcoming. There should be consideration for the senior shoppers and poor eye sight customers.
  • Smell A store should give good olfactory experience. There should not be smell of the employees lunch boxes drifting across the stores.
  • Signage The signs should not be hand-written.
  • Check-out In order to save the manpower costs and energy overheads, there should not be long queues of the customers at the check out counters.

Social Marketing

Consumers are going to place their money  behind the brands that are made by companies whom they regard as having social and environmental consciousness. The marketing era that lasted for 30-40 years is dead now. The brand is being managed by the customer. What the company does now is to manage the relationship with the customer.

Retailer recommendations, TV advertising ( powerful influencer through mid-70s until the 1990s ) have lost their appeal. Facebook and Twitter are becoming powerful mediums, and are going to be the most powerful communicators and persuaders.