Brand evaluation is an important tool in effective brand management.
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Simply put, brand evaluation is a measure of the brand's performance and determines how powerful it is in altering consumer decisions. This further helps marketers decide on future marketing strategies.
Brand Evaluation Metrics
Some of the most common branding metrics include brand perception, brand performance and brand financial value.
Branding starts with customer awareness followed by their association with the brand.
According to Hong Kong based brand strategist, Colin Bates, a brand is a collection of perceptions in the mind of the consumer. Factors that connect customers to a particular brand include customer perception of the brand, product attributes, celebrity endorsements influencing brand equity etc. Brand management decisions should be made to develop these associations and thereby increase brand credibility and loyalty.
Credibility of the brand also increases with durability. Some of the most valuable brands like Coca Cola, McDonald and GM have withstood the tests of time, change of ownership and competition, and have still retained their premier positions in the respective industries. This represents the strength and stability of the brand in relation to the market leaders. A strong brand is a clear indicator of future profits and a driver in making brand extension decisions.
This gives a measure of how influential the brand is, on actual customer choice. Some of the measuring factors include the price premium value a brand commands over its competitor's brand, customer attitude towards the brand etc. This determines how satisfied and loyal customers are towards the brand.
All these information can be obtained through surveys and other marketing campaigns. This in turn, enables marketers to calculate the return on investment and life time value of the brand-which in itself is another key performance indicator.
A highly performing brand retains its existing customers while trying to attract new customers, thus increasing its life time value. Once a brand's performance is known, it is easier to determine various brand optimization techniques to improve the power of the brand.
Brand Financial Value
The third and most important metric from a company's point of view is the monetary value of its brand. This includes the impact of the brand on sales and other revenue generation techniques. It also entails the return on investment in brand marketing, market share and the rate at which a brand sustains growth.
Brands are the most valuable intangible assets of many companies as they represent a sizeable portion of the company's market value. Hence a number of branding models which involve accepted accounting practices are used to compute the true financial value of a brand
Thus, in a world of ever changing and numerous brands to choose from, appropriate brand evaluation should be made before taking and brand marketing decisions. Regular monitoring and updating of these metrics is a sure-fire way of increasing the equity of the brand.