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Lecturer Md Shahedur RahmanChapter 2 Part 2 Customer Based Brand Equity

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Sub-Dimensions of CBBE PyramidLOYALTYATTACHMENTCOMMUNITYENGAGEMENTQUALITY CREDIBILITYCONSIDERATIONSUPERIORITYWARMTHFUNEXCITEMENTSECURITYSOCIAL APPROVALSELF-RESPECTCATEGORY IDENTIFICATIONNEEDS SATISFIEDPRIMARY CHARACTERISTICS &SECONDARY FEATURESPRODUCT RELIABILITY, DURABILITY & SERVICEABILITYSERVICE EFFECTIVENESS, EFFICIENCY & EMPATHY STYLE AND DESIGN PRICEUSER PROFILESPURCHASE & USAGE SITUATIONSPERSONALITY & VALUESHISTORY, HERITAGE & EXPERIENCESSalience Dimensions2.4Depth of brand awarenessEase of recognition and recall Breadth of brand awarenessPurchase considerationConsumption consideration

Depth and Breadth Importance2.5The product category hierarchy shows us not only the depth of awareness matters but also the breadth ( Width o Size).

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.

Product Category Structure2.6To fully understand brand recall, we need to appreciate product category structure, or how product categories are organized in memory.

Performance Dimensions 2.9Describes how well the product or service meet customers functional needs

23Performance Dimensions 2.10Five important types of Benefits and Attributes often underlie brand performancePrimary characteristics and supplementary featuresProduct reliability(consistency of performance overtime), durability (Economic life of the product), and serviceability ( After Sales Service)

23Performance Dimensions 2.113. Service effectiveness ( How well it satisfies the customer?), efficiency (Speed of Service), and empathy ( Provider seen as trusting and caring)4. Style and design5. Price

23Imagery Dimensions2.121. User profilesDemographic and psychographic characteristicsActual or aspirationalGroup perceptionspopularity

2. Purchase and usage situationsType of channel, specific stores, ease of purchaseTime (day, week, month, year, etc.), location, and context of usage

Imagery Dimensions2.134. Personality and valuesSincerity, excitement, competence, sophistication, and ruggedness

5. History, heritage, and experiencesNostalgiaMemories

Judgment Dimensions2.14Brand qualityValue (Perceived Quality )SatisfactionBrand credibilityExpertise ( Competant, innovative and a market leader)Trustworthiness ( dependable and keeping customers interests in mind )Likeability ( Fun, interesting and worth spending time with )

Brand considerationRelevance (Considering for possible purchase or not )Brand superiorityDifferentiation( Consumers consider better than others or not )

Judgment Dimensions2.15Brand judgments are customers personal opinions about and evaluations of the brand, which consumers form by putting together all the difference brand performance and imagery association

Feelings Dimensions2.16WarmthConsumers may feel sentimental warmhearted or affectionateEg. TitanFunJoyous , playful, cheerful Eg. Disney landExcitementEnergized, being cool or being alive Mountain Dew or MTV SecuritySafety, Comfort and Self assuranceInsuranceSocial ApprovalLook favorably on their appearanceMercedesSelf-respectSense of Pride, accomplishment or fulfillmentTide Detergent laundry doing the right thing for the family

Resonance Dimensions 2.17Behavioral loyaltyAttitudinal attachmentSense of communityActive engagement

Resonance Dimensions 2.18Behavioral loyaltyFrequency and amount of repeat purchasesAttitudinal attachmentPositive attitudeLove brand (favorite possessions; a little pleasure)Proud of brandSense of communityKinship ( people associated with the brand )AffiliationActive engagementSeek informationJoin clubVisit website, chat rooms

Customer-Based Brand Equity ModelConsumer-BrandResonanceBrand SalienceConsumer JudgmentsConsumer FeelingsBrandPerformanceBrandImageryINTENSE, ACTIVE LOYALTYRATIONAL & EMOTIONAL REACTIONSPOINTS-OF-PARITY & POINTS-OF-DIFFERENCEDEEP, BROAD BRAND AWARENESSBrand Building ImplicationsCustomers own brands The power of brands and its ultimate value to firm reside with customers.Dont take shortcuts with brands otherwise the foundation of the brand will be weak. Brands should have a duality a functional and an emotional route. Example: Close up. Brand resonance provides important focus marketers building brands should use brand resonance as a goal and as a means to interpret their brand related marketing activities.

2020customer equity case: Cadillac CTS21Cadillac is all about American Luxury.

It had a market share of more than 50% in the luxury car market.

Cadillac customer were getting old:60+

Lifetime value is decreasing.

Customer equity was decreasing.

BMW gained market share and Customer equity while targeting younger consumers.

So Cadillac launched the CTS.

21Is a company consumer-centric?2.22Is the company looking for ways to take care of you?Does the company know its customers well enough to differentiate between them? Is someone accountable for customers?Is the company managed for shareholder value?Is the company testing new customer offers and learning from the results?

Sources: Larry Selden and Geoffrey Colvin, 2004. Customer Relationship Management (CRM)2.23Uses a companys data systems and applications to track consumer activity and manage customer interactions with the company

Building customer equityNot only to create profitable customers, but to OWN them for life, earn a greater share of their purchases (share of customer), and capture their customer lifetime value.The ultimate aim of CRM is to produce high customer equity.Customer equity is the total combined customer lifetime values of all of the companys customers. Sales and market share relates to the past.Customer equity related to the past and the future.

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24Building the right brand relationships with the right customerBuilding the right relationships with the right customers involves treating customers as assets that need to be managed and maximized.Different types of customers require different relationship management strategies.

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25Relationship of Customer Equity to Brand Equity 2.26Customers drive the success of brands but brands are the necessary touchpoint that firms have to connect with their customers. Customer-based brand equity maintains that brands create value by eliciting differential customer response to marketing activities. The higher price premiums and increased levels of loyalty engendered by brands generate incremental cash flows.