Measuring and Interpreting Brand Performance - Assignment Example

Measuring & Interpreting Brand Performance Brand performance means that the value of the brand must bear interest and provide a measurable contribution of the success of the entire business. Many businesses provided they possess brands, if their competitive environment and their business results are excellent due to their brand compared to other businesses that have failed to utilize brands. In keeping with Spitzer (2007), the need to measure the performance of an organization at macro-level has been prevalent in order to assess the performance of an establishment. It is important to evaluate the performance its products and this is applied on a micro level of the performance and this is referred to as sales marketing. Failing to measure the brand performance has been a major weakness, widely discussed as brand is the primary possession of a company. In reality, brand plays a primary role on the success any organization through creation of a competitive advantage via the performance of means that are not related to the product. Understanding the difference of the products through their branding has been of great benefit to businesses including consistent volumes and revenue for several years, getting fair share, and resisting the attacks (Spitzer, 2007). To understand the effects of programs involved in brand making it is critical to measure and interpret the brand performance; this is a useful tool of measuring brand value chain. The brand value chain can be defined as a means of tracing the value creation process for brands. This will help to understand the fiscal impact of brand marketing investments and expenditure. A cost-effective brand management system comprises of successful designing and implementation of a brand equity measurement system comprising of a set of research procedures that are designed to provide accurate, timely and actionable information. This will enable the marketers to make excellent tactical decisions both in the short-run and in the long-run. 1. Analyze Table 1. Describe the differences and patterns that you see between the competing brands, and specifically for Snickers brand. Table 1: Brand Performance Metrics Brand Market share Penetration Average Purchase Frequency Category Buying Rate Share of Category Requirements Sole Loyalty Mars Bar 34 74 2.2 5.8 39 22 Kit Kat 24 52 2.3 6.2 37 7.7 Snickers 20 48 2.0 7.4 27 4.2 Twix 16 46 1.7 7.3 23 0 Nestle Gold 6.5 26 1.2 8.5 14 0 Average 20 49 1.9 7.0 28 6.7 Snicker is an average brand among the brand categories that are listed above. Its high level of sole loyalty falls indicates that the brand is in the category of repertoire market and that the consumer decides o whether to go for the brand or not. The buying rate of snickers brand is also average and its share of category is also average. With other brands like Mars Bar enjoying high rate of penetration extremely high rate of sole loyalty high share category requirements and a relatively high average purchasing frequency, one can therefore, depict that Mars Bar has a very strong brand salience compared to other brands in the same category. Nestle Gold performance on the other hand is below average, there is much that needs to be done to improve the brands salience in the market. Twix on the other hand is the other brand that has performed poorly in the brand category and as Nestle Gold it requires much improvement in order to compete with other brands in the market. The two brands Twix and Nestle Gold do not have sole customer loyalty. Factually, Snickers sole loyalty is below average, its penetration in the market too is below average and share of Category Requirements is also below average. 2. Explain the difference between a repertoire market and a subscription market. What differences would you expect to see in brand performance metrics between a subscription market and a repertoire market? What type of market is Snickers operating in? Explain your answer? Subscription marketing refers to repeat purchasing sequence, predictability and behavior. This makes subscription marketing a critical part of majority of revenue forecast, this include spawning CRM programs and loyalty cards. Repertoire market in contrast customers have a range of products to choose from i.e. you’re thirsty, Do you need your beverage cold or hot, do you need your drink caffeinated or not, should it be carbonated or not. In subscription marketing, the purchaser show to be loyal, purchasing with a regular pattern some of the typical industries in subscription marketing include banking, newspapers and magazines, insurance, telecommunication and fitness club. Some of the characteristics of subscription marketing are; one can identify customers by name, account number or address. The customer is definable; some customers are not loyal by choice; products or services are boring as a topic of conversation. Brand snickers lay in a repertoire market. Subscription markets and repertoire markets are different in various ways as illustrated in the table below. Subscription marketing Repertoire marketing Decision makers Decisions made by a panel of committee. Decisions are made by individuals. Individual are gatekeepers. Purchase Decisions Multiple events are covered Each event requires making a decision Purchasing frequency/ pattern Usually defined, predictable Not define and less predictable Competitive set Alternatives are limited Numerous alternatives Customer base Finite, static Infinite, fluid Price Price insensitive, long term, contracted Predetermined and price sensitive Differentiation Diminutive differentiation Vastly differentiated A product marketing plan is enriched with idea generation, market size, concept testing, packaging, positioning, pricing, awareness attitudes, communication and usage. Such techniques vary by the type of market. Subscription marketing Repertoire marketing Involvement Relatively low involvement and complex concepts Simple concepts, relatable Concept testing Decision makers users Market sizing Intent-to-purchase, conversion rates Preference share Purchase pattern Usually a necessity Mostly non-essential commodities that are “wanted” Price Value justification, price tolerance Price sensitive, elastic prices Loyalty Customer retention, Contract renewal Customer loyalty Satisfaction Relationship satisfaction Product satisfaction. In conclusion, subscription markets are different from repertoire markets both with different customer behaviors, different needs and both require different research techniques. Snicker is well established as a repertoire market. Though it is depicted to having an average buying rate as compared to other brands, a low market penetration which depicts poor brand salience, it sole loyalty in incredibly high. This illustrates that individuals make decision on whether to get the brand. The presence of other competing brands also depicts availability of several choices at the customer’s disposal. High sole loyalty also depicts that choices are made by individuals. These all categorize snickers in repertoire marketing (Ratner & Kahn, 2002). 3. The Marketing Director has returned from Customer Loyalty conference and she brought a new idea to the team. She mentioned that Snickers should build a loyalty program for the chocolate buyers. She said, "Surely we should reward customers who have been buying Snickers and give those gifts and discounts! This is the only way we grow our brand!” She knows that you are taking Buyer and Consumer Behavior, so you have been asked to comment on this plan. With your knowledge of how brands grow and how consumers buy brands, provide some answers to either support or criticize this plan. Section 2: Awareness & Salience Define brand salience and compare the concept with attitude. Brand salience can be referred to as the degree to which a brand is thought about or easily recognized when a client is in a purchasing situation. Awareness is when people recognize you first to fulfill their needs. On the other hand, attitude stands for general and long leaved positive, impartial or modest evaluation of person, institution, object or event. According to Maheswaran and Agrawal (2004), the most established awareness only focus on the initial brand recalled, the brand attitude focuses more on evaluation of the brand than quality and quantity of the memory structures while brand salience can retrieval in purchasing situations, hence, the brand is considered in a buying situation. Brand salience likes the brand to product cues, in this case, the brand must be considered as a preference from the category. Additionally, brand salience have been associated with several cues, hence it can increase the brand customers. On the whole, building the brand salience can boost the number of customers thinking of brand and the customers think about the brand in buying situations in order to elevate the brand profit. Importance of salience for brands The buyers only notice items that are pertinent themselves like things they use frequently, therefore, the users of a brand are more likely to recall exposure to adverts than non users. Users of a brand in most cases pay attention to brand salience than non users. The buyers notice more salience and cues for brand; these saliencies are the reason that the brand attracts more purchases. In this case, focus on salience for a brand user separately helps marketers to understand the cues used by the buyers when making buying decisions better. Subsequently, the brand can provide further suitable salience which consumers consider of the brand when they are in a buying situation. What is the advantage of measuring salience and not attitudes? In reference to Artur, Karen and Gudrun (2003), brand attitude can be considered as lasting evaluations that act as a mental prompt to act. Attitude only has a weak influence on buyers’ the future behavior and this is because they are often not recalled and when they are recalled, they become weakly motivational. Attitudes’ influence on the behavior of a buyer and depends on the attitude being remembered, and how motivational the attitude is. In most cases, people do not have attitudes to draw upon to draw upon and guide their behavior, and mostly all the effects of the attitudes are equally liked or disliked. As a result, the impact of attitude on buying behavior is commonly weak especially when influencing brand choice. On the other hand, salience differentials have a huge impact on people’s personal brand repertoires; at cumulative level they greatly explain the market share dissimilarities between brands (Maheswaran & Agrawal, 2004). The influence of brand salience is very different to the brand attitude. Attitude is about evaluating the brand while salience largely lies on being thought of the buyer. 5. What patterns do you see in Table 2 relating to brand salience? Table 2: Awareness & Salience Metrics Brand Top of Mind Awareness Overall Brand Awareness Salience (Whole Sample) Salience (User Only) Mars Bar 41 89 36 42 Kit Kat 19 73 21 41 Snickers 18 72 18 35 Twix 12 65 17 35 Nestle Gold 2 10 12 43 Average 18 62 19 39 As depicted in Table 2 above, brand snicker is an average brand. Snickers have not established its brand salience well in the market and this seems to be a shortcoming in the brands sales. With products like Mars Bars having well established brand salience, it will require a lot of strategic planning and marketing to make Snicker to be at competing level with such brands in the market. The brand does not perform well within the whole sample and within its customer base. Generally, Snickers underperformance can be redeemed by improving in its marketing strategies. Brand consumers use all sorts of different attributes when they want to retrieve brands. They can use multiple cues over different purchasing occasions or even at a single point. Some of the attributes that may help Snickers include buying situations like issuing of gifts, taking to a barbeque. Snickers should design a list of attributes for a salience measure; they should incorporate a diverse range to capture superiority of the system memory. 6. With Snickers being the third on the list, your Marketing Director is also getting restless. She wants to change the design of the package and modernize it by changing the color and the font. Please provide your answer to this plan to change the color and the font - either to support or criticize it based on your knowledge of salience and how consumers buy brands. I would support the marketing director because of various reasons and illustrated here in. In salience, advertising reinforces and builds consumers memory about the brand. Brands are made up of frequently unprocessed groups of associations consisting of feelings, sounds, images fragments of understanding and abstracted knowledge. Boosting the face of packages through redesigning and modernizing it well creates a new imagination in people’s mind (Kevin & Donald, 2003). To some extent this will play a vital role in re-establishing the brand as a new improved commodity. Brand memory structure is developed and refreshed through experiences through word of mouth, using the brand and exposure to advertisements. The more far-reaching and fresher the brands’ reminiscence structure the superior its salience and the more the chances to be thought of in different buying situations. The most dominant way that advertisements work is by refreshing and building brands memory structure and this is how advertising boosts brand’s salience. Section 3: Demographics & Segmentation 7. Look at the data in Tables 3-5. Is the customer profile of Snickers different to that of the competition? Why/ Why not? Brand Single Couple Divorced/ separated Single Deviations Couple Deviations Divorced/ Separated Deviations Average MAD Mars Bar 22 62 14 2.5 -3.2 0.7 2.2 Kit Kat 17 68 14 -3.1 2.2 1.0 2.1 Snickers 16 65 18 -3.3 -0.9 4.2 2.8 Twix 20 68 9.2 0.0 2.8 -4.2 2.4 Nestle Gold 24 65 12 3.8 -0.9 -1.7 2.1 Average 20 66 13 2.5 2.0 2.4 2.3 Table 4: Demographics - Total household income Brand Less than $50,000 $50,000- $70,000 More than $70,000 $70K Deviations Average MAD Mars Bar 23 29 31 3.0 5.8 -7.6 5.5 Kit Kat 21 19 43 1.3 -4.3 4.2 3.3 Snickers 16 22 40 -3.4 -0.9 0.9 1.7 Twix 21 22 39 1.2 -0.9 0.4 0.8 Nestle Gold 18 24 41 -2.2 0.3 2.1 1.5 Average 20 23 39 2.2 2.4 3.0 2.6 Table 5: Demographics – Gender Brand Male Female Male Deviations Female Deviations Average MAD Mars Bar 40 60 4.0 -4.0 4.0 Kit Kat 34 66 -1.7 1.7 1.7 Snickers 35 65 -0.8 0.8 0.8 Twix 36 64 -0.6 0.6 0.6 Nestle Gold 35 65 -0.8 0.8 0.8 Average 36 64 1.6 1.6 1.6 The customer profile of Snickers is not different from that of other products. By examining the deviations on all the brands for some particular attributes one can possibly determine which attribute can be used to develop snickers image. The managing director can choose to avoid those attributes that are highly associated with other brands competing head to head with a competitor. The influence of negative deviation appears due to weakness in other brands and as such the other brands emerge stronger on such attributes. A deviation is associated with the agreement between the user and non-users of any brand. Most of the people who use al the brands are couples as illustrated in Table 3. The estimations of brand salience, in addition to, top-down mechanisms and bottom-up mechanisms help to clearly analyze the competitive salience of snickers among other brands. The above analysis reveals visual potency and weak points of all the brands. References Artur, B., Karen S., & Gudrun, B. (2003). "Performance Consequences of Brand Equity Management Evidence from Organization in the Value Chain", Journal of Product & Brand Management, vol.12, Kevin, L & Donald R. (2003). “How Do Brands Creat value", Marketing Management, vol.12, No.3, pp.26-31. Maheswaran, D., & Agrawal, N. (2004). Motivational and cultural variations in mortality Salience effects: Contemplations on terror management theory and consumer behaviour. Journal of Consumer Psychology, 14(3) Ratner, R.K., & Kahn, B.E. (2002). The impact of private versus public consumption on variety-seeking behavior. Journal of Consumer Research, 29(2) Spitzer, D. (2007). Transforming performance measurement rethinking the way we measure and drive organizational success. New York: American Management Association. Woodside, A. & Carol M. (2009). Perspectives on cross-cultural, ethnographic, brand image, storytelling, unconscious needs, and hospitality guest research. Bingley, UK: Emerald. Read More