Download When Brand Marketers Must Deal With Unfavorable

Chapter 2
MARCOM’S CHALLENGES: ENHANCING
BRAND EQUITY, INFLUENCEING
BEHAVIOR, AND BEING ACCOUNTABLE
Chapter Objectives




To explain the concept of brand equity from both the company’s and the customer’s
perspectives.
To describe the positive outcomes that result from enhancing brand equity.
To present a model of brand equity from the customer’s perspective.
To examine how marcom efforts must influence behavior and achieve financial
accountability.
Chapter Overview
The basic issues addressed in this chapter are these: What can marketing communicators
do to enhance the equity of their brands and, beyond this, affect the behavior of their
present and prospective customers? Also, how can marketing communicators justify their
investments in advertising, promotions, and other marcom elements and demonstrate
financial accountability?
The concept of brand equity is explained from both the company’s perspective and the
consumer’s perspective. The firm-based viewpoint of brand equity focuses on outcomes
extending from efforts to enhance a brand’s value to its various stakeholders and
discusses various outcomes: (1) achieving a higher market share, (2) increasing brand
loyalty, (3) being able to charge premium prices, and (4) earning a revenue premium.
From the perspective of the customer, a brand possesses equity to the extent that they are
familiar with the brand and have stored in their memory favorable, strong, and unique
brand associations. Brand equity from the customer’s perspective consists of two forms
of brand-related knowledge: (1) brand awareness and (2) brand image. The chapter
covers three ways by which brand equity is enhanced and labels these the (1) speak-foritself approach, (2) message-driven approach, and (3) leveraging approach. The chapter
then discusses ten traits shared by the world’s strongest brands.
The latter portion of the chapter covers the concept of ROMI, or return on marketing
investments. Several difficulties of measuring marcom effectiveness are discussed: (1)
choosing a metric, (2) gaining agreement, (3) collecting accurate data, and (4) calibrating
specific effects. The chapter then discusses marketing-mix modeling (i.e., multivariate
regression analysis) and how it can assist managers in determining the effect of each
marcom element on sales volume.
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 Marcom Challenge: Harley-Davidson – An Iron Horse for Rugged
Individuals
An advertisement that depicted a driver-less Harley-Davidson motorcycle does not tout
product features for which the Harley-Davidson is known or functional benefits such as
power and performance. It simply represents the sense of freedom, independence, and
even rebelliousness that a prospective purchaser might desire in owning this brand and
driving the open roads. What makes Harley-Davidson motorcycles such a unique and
strong brand? It’s the deep emotional connection with present and prospective owners.
Harley has positioned the brand as virtually synonymous with American culture and
values of personal freedom, rebelliousness, and rugged individualism. Its reputation for
producing high-quality and reliable products was established during World Wars I and II,
and returning GIs passed along their feelings to fellow Americans. Harley also has
created a sense of brand community among owners through a variety of efforts, such as
bike rallies and the Harley Owners Group (H.O.G.), that have touched its customers in
many ways. These efforts have led Harley-Davidson to be rated as a top brand by
business leaders.
When Brand Marketers Must Deal With Unfavorable
Country Images
Many brands are marketed by companies that typically are identified with the identities
and images of the countries in which they originate (e.g., Volkswagen/Germany).
However, consider the case of China, which is well-known and much admired for making
low-cost and good-quality products that are outsourced by companies in other countries,
but it is not known for its domestic companies that produce and market branded products
of their own. Most people cannot name a single product that holds a Chinese brand
name, but many Chinese companies are in the process of dealing with their country’s
image problem and attempting to market products globally under their own brand names.
The example of TCL Corporation, which is a large electronics firm, is highlighted in
which the company first plans to expand with their own, lower-priced, high-quality TV
brands in Indonesia and then the rest of Asia and the world. They plan on selling directly
to consumers, offer a three-year warranty (longest on the market), and provide excellent
customer service. However, it may take years before a Chinese company can successfully
market its brands around the world.
Neuromarketing and the Case of Why Coca-Cola
Outsells Pepsi
The infamous “Pepsi Challenge” was conducted with the use of neuromarketing, which is
a specific application of the field of brand research called neuroscience. Functional
magnetic resonance images (fMRIs) can scan the brains of individuals employing their
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various senses upon exposure to stimuli. Brain scans reveal which areas of the brain are
most activated in response to external stimuli. In the new-fangled Pepsi Challenge, the
reward center of the brain revealed a much stronger preference for Pepsi versus Coke
when study participants were unaware of which brand they had tasted. However, the
result was opposite when participants knew the name of the brand they were about to
taste. In the non-blind taste test, a different region of the brain was more activated and
Coca-Cola was the winner. Activation of the area of the brain associated with cognitive
functions revealed that participants now preferred Coke. The inferred explanation is a
difference in brand images, with Coke possessing the more attractive image earned
through years of effective marketing and advertising effort.
Chapter Outline
1. Desired Outcomes of Marcom Efforts
 Recall from Chapter 1 the framework for thinking about all aspects of the marcom
process (Figure 1-3):

Fundamental decisions (positioning, targeting, objective setting, and budgeting)

Implementation decisions (mixing elements, creating messages, selecting
media, and establishing momentum)

Outcomes (enhancing brand equity and affecting behavior)

Program Evaluation
 This chapter focuses on the desired outcomes of marcom efforts.
2. The Concept of Brand Equity
 A brand represents a “name, term, sign, symbol, or design, or a combination of
them intended to identify the goods and services of one seller or group of sellers
and to differentiate them from those of competition.”
 Without a recognizable brand, a product is but a mere commodity.
 It’s more than just a name, term, symbol, etc. – a brand is everything that one
company’s particular offering stands for in comparison to other brands in a category of competitive products.
 Brand equity can be considered either from the perspective of the organization
that owns a brand or from the vantage point of the customer.
A Firm-Based Perspective on Brand Equity
 Focuses on outcomes extending from efforts to enhance a brand’s value to its
various stakeholders.
 As the value, or equity, of a brand increases, various positive outcomes result:

achieving a higher market share
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
increasing brand loyalty

being able to charge premium prices

earning a revenue premium, which is defined as the revenue differential
between a branded item and a corresponding private labeled item
A Customer-Based Perspective on Brand Equity
 Brand equity exists to the extent that consumers are familiar with the brand and
have favorable, strong, and unique associations with the brand.
 Brand equity has two main forms of consumer knowledge: brand awareness and
brand image.



Figure 2.1 portrays the two dimensions of brand knowledge and delineates
each dimension into its specific components.
Brand awareness: when a consumer thinks about a product category and a
brand name comes to mind. Awareness is the basic dimension of brand equity
and has three dimensions:

Brand recognition: consumer is able to identify a brand if it is presented to
them on a list or if hints/cues are provided.

Brand recall: consumer can retrieve a brand name from memory without
any reminders.

Top-of-mind-awareness (TOMA): brand is first that consumer thinks of
when asked about product category.

The failure of dot-coms can be seen in part as a failure of not building successful brand equity such that consumers could remember and know what
their businesses did. Indeed, the dot-coms assumed that basic brand
awareness was all they needed, when in fact the brand must ultimately be
tied to some benefit.
Brand Image: the types of associations that come to mind when contemplating a particular brand.


An association is simply the particular thoughts and feelings that a consumer has about a brand.

Associations can be based on attributes (product-related and
non-product-related), benefits, and overall evaluation (attitude).

Associations derived from brand benefits stem from functional,
symbolic, or experiential needs. (Note: These needs are explained in Chapter 5)
Four main kinds of associations are type, favorability, strength, and
uniqueness.
 Five dimensions have been identified for different brands’ “personalities.”
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1. Sincerity—brand is seen as down to earth, wholesome and cheerful (e.g., Mr.
Goodwrench).
2. Excitement—brand is seen as daring, spirited, imaginative, and up-to-date
(e.g., Hummer).
3. Competence—brand is seen as reliable, intelligent, and successful (e.g.,
Toyota).
4. Sophistication—brand is seen as upper class and charming (e.g., Rolex).
5. Ruggedness—brand is seen as tough and outdoorsy (e.g., Timberland)
How Can Brand Equity Be Enhanced?
 Efforts to enhance a brand’s equity are accomplished through the initial choice of
a positive brand identity but mostly through marketing and marcom programs that
forge favorable, strong, and unique associations with the brand in the consumer’s
mind.
 Three ways by which brand equity is enhanced:
1. Speak-For-Itself Approach: by trying and using brands, consumers learn how
good (or bad) they are and what benefits they are (in)capable of delivering.
2. Message-Driven Approach: marcom practitioners can build advantageous associations via the dint of repeated claims about the features a brand possesses and/or
benefits it delivers. This tack is effective if the marcom message is creative, attention getting, and believable.
3. Leveraging Approach: brand associations can be shaped and equity enhanced by
leveraging positive associations already contained in the world of people, places,
and “things” that are available to consumers.
TEACHING NOTE: When using the leveraging approach, three factors
influence the result (from Keller 2003, chapter endnote #21):
o What is the consumer’s knowledge of the other entity (i.e., person,
place, or thing)?
o How meaningful is that knowledge?
o How likely is it that that knowledge will actually affect what they
think of the brand?

Co-branding: two brands enter into an alliance that potentially serves to
enhance both brands’ equity and profitability. Brands that enter into alliances do so on grounds that their images are similar, that they appeal to the
same market segment, and that the co-branding initiative is mutually beneficial. Most important requirement for success is that brands possess a
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common fit and that the combined marcom efforts maximize the advantages of the individual brand while minimizing the disadvantages.
TEACHING NOTE: A recent study examined the impact of cobranding on consumers’ perceptions of brand equity for the co-branded
product and the two brands that comprised it and concluded that cobranding represents a “win/win strategy” for both partners. The study
found that while low equity brands benefit most from co-branding, the
brand equity of the high equity brand was not denigrated even when
paired with a low equity partner brand. So the worst case scenario of a
high equity brand paired with a low-equity partner results in no loss of
equity for the higher equity brand, and the best case scenario is one in
which both partners experience substantial benefits from the alliance.
(Source: Washburn, Judith H., Brain D. Till, and Randi Priluck (2000),
“Co-Branding: Brand Equity and Trial Effects,” Journal of Consumer
Marketing, 17(7), 591-604.)

Ingredient branding: pairing a branded ingredient to build equity in a
brand (e.g., “Intel Inside”).
TEACHING NOTE: Another example of ingredient branding is
The Solae Company, which is trying to increase consumer awareness of its
soy protein and products that include it. This company, along with General Mills, created 8th Continent Soymilk, and the Solae soy protein
ingredient is prominently featured in the product’s advertising. The manufacturers believe that touting the fact that Solae soy protein is an
ingredient is a smart strategy because they can provide consumers taste
assurance and years of nutritional research backing its nutrition claims.
This example, as well as a few others, led the author to suggest three
things that should be kept in mind when considering ingredient branding:
o the ingredient brand and the finished product should each support
the other’s positioning,
o functional claims need to be backed by research, and the host
brand should receive incremental marketing value from the relationship, and
o all marketing activity should convey a consistent message to consumers.
(Source: “Branding Partnerships: The Combination of Branded Products With Branded Ingredients Can Create Consumer Pull,” (2005),
Beverage Industry, (June), 59-62.)
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What Benefits Result From Enhancing Brand Equity?
 brand loyalty: that’s the true asset
TEACHING NOTE: Marketers should be aware, however, that care must be
taken when enhancing brand equity to avoid the situation called trademark cancellation, or “genericide.” This is a condition in which a manufacturer’s brand
represents a product category in consumers’ minds, and consequent legal action may
result in that brand name being declared a generic term. Examples of brands that
have suffered from genericide are aspirin, thermos, yo-yo, shredded wheat, escalator,
and trampoline. If this is the case, that brand’s mark can be used by competitors.
Taylor and Walsh (2002) reviewed court cases and offer ways to avoid a finding of
genericness:

select a distinctive, nongeneric name when the product is introduced,

monitor employees’ and advertising’s use of the trademark,

monitor competitors’ and others’ use (i.e., trade) of the trademark,

make use of appropriate survey evidence when a case comes about, and

make use of expert witnesses (p. 165).
While marketers want their brand to dominate a product category, it is imperative
that a brand’s owner takes actions to preserve the legal protection of the brand’s
equity. For more information on this issue, see Oakenfull, Gillian and Betsy Gelb
(1996), “Research-Based Advertising to Preserve Brand Equity But Avoid ‘Genericide’,” Journal of Advertising Research, (Sept/Oct) 65-73 and Taylor, Charles R. and
Michael G. Walsh (2002), “Legal Strategies for Protecting Brands from Genericide:
Recent Trends in Evidence Weighted in Court Cases,” Journal of Public Policy &
Marketing, 21 (Spring), 160-167.
Characteristics of World-Class Brands
 The biannual EquiTrend survey uses two main dimensions to determine highly
successful brands: quality and salience (type of brand awareness).

Combining the two dimensions gives an “equity score.” (Note: See Discussion Question #11 for an example.)

10 world class brands identified in Table 2.1: Smithsonian Institution, Craftsman Tools, Crayola, Bose, Hershey’s Kisses, Reynolds Wrap, M&M’s,
Discovery Channel, WD-40, and Ziploc.

All these brands had a straightforward promise of what they deliver and have
consistently delivered it.
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 Traits shared by the world’s strongest brands:
1. Brand excels at delivering benefits customers desire.
2. Brand stays relevant.
3. Pricing system matches consumers’ perceptions of value.
4. Brand is properly positioned.
5. Brand is consistent.
6. Brand portfolio and hierarchy make sense.
7. Brand makes use of and coordinates a full repertoire of marketing activities to
build brand equity.
8. Brand’s managers understand what the brand means to consumers.
9. Brand is given proper support over the long run.
10. The company monitors sources of brand equity.
3. Effecting Behavior and Achieving Marcom Accountability
 Marcom efforts should be directed, ultimately, at affecting behavior rather than
stopping with enhancing equity.
 Marcom’s objective is to ultimately affect sales volume and revenue.
 ROMI: return on marketing investment.
TEACHING NOTE: For a good overview of ROMI and marketing mix
modeling, see Cook, William A. and Vijay S. Talluri (2004), “How the Pursuit of
ROMI is Changing Marketing Management,” Journal of Advertising Research, 44
(Sept/Oct), 244-254. This article discusses ROMI’s importance, benefits, requirements, integration with core business processes, and barriers to success as well as
the role of marketing mix modeling. Another good example that shows the genesis of
this approach can be found in Stone, Randy and Mike Duffy (1993), “Measuring the
Impact of Advertising,” Journal of Advertising Research, 33 (Nov/Dec), RC-8-RC-12.
It provides a case discussion of how Kraft began employing these methods in the
early 1990s. It is interesting to note that Kraft was featured as a “best-practice” firm
in the Advertising Research Foundation’s benchmarking study (2001) as a company
recognized for implementing a successful program to improve their ROMI. The ARF
benchmarking studies (2001 and 2003) as well as several others are discussed extensively in Cook and Talluri (2004).
 Motivations underlying the increased focus on measuring marketing performance:
 demands for accountability from the CEO, the Board, and other executives
 imperative for CMOs to get better at what they do in light of budget battles
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TEACHING NOTE: Another pressure on marketing accountability is the
Sarbanes-Oxley Act (Sarbox), which was passed in 2002. In the aftermath of corporate
scandals such as WorldCom and Enron, this legislation tightens corporate-governance
and reporting requirements, and it requires CEOs and CFOs to sign off on the validity of
corporate accounts. Some claim the impact on marketing could be substantial. First, the
additional auditing fees necessary to comply with the act will have to come from budget
cuts somewhere else, and marketing is a likely target. Second, corporate boards tend to
be made up of finance and audit experts, so more energy may be focused on complying
with Sarbox than focusing on marketing and customers. Third, marketing expenditures
have been suspect as some marketing service providers have been overbilling clients. In
this climate, marketing requires good management and measurement to build credibility.
(Source: McGovern, Gail and John Quelch (2005), “Sarbox Still Putting the Squeeze on
Marketing,” Advertising Age, (September 19), 28.)
Difficulty of Measuring Marcom Effectiveness
 Several reasons account for the complexity of measuring marcom effectiveness:
 Choosing a Metric: brand awareness, attitudes, purchase intentions, and
sales volume.
 Gaining Agreement: individuals from different backgrounds and with varied
organizational interests often see the “world” differently or operate with varying ideas of what best indicates suitable performance.
 Collecting Accurate Data: data must be reliable and valid.
 Calibrating Specific Effects: identify the relative effectiveness of individual
program elements.
Assessing Effects with Marketing-Mix Modeling
 Employs well known statistical techniques (e.g., multivariate regression analysis)
to estimate the effects that the various advertising and promotion elements have in
driving sales volume.
 Relatively long series of longitudinal data (i.e., two years) is required.
 Data for each period would include the level of sales during that period (i.e,
dependent variable) along with corresponding marcom expenditures for each program element (i.e., independent variables).
 Can learn which elements outperform others and can shift budgets accordingly.
 Widely used by consumer package good companies (e.g., P&G, Clorox), but it is
also being used increasingly by other B2C and B2B companies.
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TEACHING NOTE: Advertising agencies are adopting this approach as
well. For example, one of the world’s largest ad companies, WPP Group, is applying
econometrics to help measure the effectiveness of an ad. Changes in media technologies making traditional TV advertising less effective and demands by corporate
managers for accountability have put pressure on agencies to show that ads produce
sales. WPP is putting resources into econometrics by increasing the number of
employees working on econometric models to 150, up from just 20 employees five
years ago. Omnicom Group, another large agency holding company, is also devoting
more resources to this type of effort by increasing its staff devoted to econometric
modeling to 45 from six just three years ago. Not everyone in the agency world is
jumping on this bandwagon, though. For example, at an advertising conference in
Cannes, France, one CEO of another agency told WPP Group’s CEO, Sir Martin
Sorrell with whom he was sharing the stage, that he didn’t understand what Sir
Martin was talking about, and the audience reacted with cheers and clapping. So
there might be a long way to go before econometrics is readily accepted in the advertising world. (Source: Patrick, Aaron O. (2005), “Econometrics Buzzes Ad World As
a Way of Measuring Results,” The Wall Street Journal, (August 16), B8.)
Answers to Discussion Questions
1. Tom Peters, author and management consultant, describes a brand as “passion made
palpable.”42 What do you think he means by this expression? Provide a couple of
personal examples that support Peters’s characterization of brands.
Answer:
Brand equity is closely tied to people’s feelings about the brand and the product.
Palpable means something that is obvious or something one can touch. A well
managed brand has a set of associations in the consumer’s mind that marcom can
build and maintain—a passion within the consumer that centers on the product
and can be maintained by successful marcom strategies.
2. Using the framework in Figure 2.1, describe all personal associations that the
following brands hold for you: (a) Harley-Davidson motorcycles, (b) Hummer vehicles, (c) Red Bull energy drink, (d) The Wall Street Journal, and (e) movie star Nicole
Kidman.
Answer:
Brand image can be thought of in terms of the types of associations that come to
the consumer’s mind when contemplating a particular brand. An association is
simply the particular thoughts and feelings that a consumer has about a brand, and
students’ answers will vary for this question. These associations can be conceptualized in terms of type, favorability, strength, and uniqueness. The type of brand
associations can be based on the brand’s attributes, both product-related (e.g., col-
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or, size, design features) and non-product-related (e.g., price, packaging, user and
usage imagery), the brand’s benefits (e.g., functional, symbolic, experiential), and
consumers’ overall evaluation, or attitude, toward the brand.
3. Roger Enrico, CEO of PepsiCo, was quoted in the text as saying, “In my mind the
best thing a person can say about a brand is that it’s their favorite.” Identify two
brands that you regard as your favorites. Describe the specific associations that each
of these brands holds for you and thus why they are two of your favorites.
Answer:
Students should realize that associations are not just with immediate obvious
product benefits (most will probably name some snack food as one) such as taste,
but also with other product benefits such as packaging (a water bottle with a
sports cap), accessibility or convenience (e.g., a candy machine near their dorm
room or class), price (e.g., they can afford it), and usage context (e.g., coffee with
friends). The ability of products to make the consumer an "expert" is also an interesting benefit for students who name some health and beauty aid, such as a hair
shampoo, and give a very specific benefit of how the product works for them (e.g.,
helps relax tangled hair).
4. Provide examples of brands that in your opinion are positioned in such a way as to
reflect the five personality dimensions: sincerity, excitement, competence, sophistication, and ruggedness.
Answer:
Examples:
Sincerity: Hallmark Greeting Cards
Excitement: Victoria’s Secret
Competence: Norton Anti Virus
Sophistication: Talbots
Ruggedness: Timberland boots
5. Provide several examples of co-branding or ingredient branding other than those
presented in the chapter.
Answer:
Some examples of co-branding include: Hershey Foods and General Mills making
the breakfast cereal “Reese’s Peanut Butter Puffs,” MicroSoft and NBC
(MSNBC), Visa and the United Airlines Mileage Plus Program. Some examples
of ingredient branding include: Gore-Tex material in sport and outdoor clothing,
Splenda in the new Coke Zero, Teflon in cookware, Thinsulate in clothing, Kevlar
in clothing, and NutraSweet in soft drinks.
6. When discussing brand equity from the firm’s perspective, it was explained that as the
equity of a brand increases, various positive outcomes result: (1) a higher market
share, (2) increased brand loyalty, (3) ability to charge premium prices, and (4) capac-
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ity to earn a revenue premium. Select a brand you are particularly fond of and explain
how its relatively greater equity compared to a lesser brand in the same product
category is manifest in terms of each of these four outcomes.
Answer:
Students can select any number of brands to answer this question, and one they
might select is Coca-Cola soft drink. Coke has the highest market share in the cola category, some consumers will only purchase Coke instead of other brands of
cola, even if they are on sale, Coke is more expensive than lesser brands, such as
RC Cola and store brands, and thus, Coke enjoys a revenue premium. Revenue
premium is defined as the revenue differential between a branded item and a corresponding private labeled item, so students should discuss the brand they selected
with respect to private label, or store, brands. With revenue equaling the product
of a brand’s net price x volume, a branded good enjoys a revenue premium over a
corresponding private labeled item to the degree it can charge a higher price
and/or generate greater volume.
7. Brand awareness is a necessary but insufficient condition toward building positive
brand equity. Explain what this statement means to you and provide a couple of
examples of brands that you are aware of but that, for you, do not possess positive
brand equity.
Answer:
Although building brand awareness is a necessary step toward brand equity enhancement, it is insufficient. Investing in and building a brand is a matter of
identifying a reason for the brand’s being – its underlying positioning statement
and point of distinction on a consistent basis. While students can give a number
of examples, they should explain that, while they are aware of that particular
brand, they may not understand the meaning of that brand because they do not
have many associations that come to their mind when thinking about that brand or
that they have negative associations when thinking about that brand.
8. Select a brand of vehicle (automobile, truck, motorcycle, SUV, etc.) and with this
brand illustrate the meaning to you personally of type, favorability, strength, and
uniqueness of brand associations.
Answer:
Students should answer this question along the lines of the illustration given in the
chapter of Henry and the McDonald’s fast-food chain.
9. What are your reactions to the application of neuroscience to marketing (neuromarketing) that was described in the IMC Focus? Do you consider this technique ethical?
Do you fear that with the knowledge obtained from its application marketers will be
able to manipulate consumers?
Answer:
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The application of neuroscience to marketing described in the IMC Focus really
serves to illustrate the importance of building brand equity through various marketing and marcom processes. It seems to validate that consumers’ preferences
can be influenced by these activities. The IMC Focus illustrated that consumers
preferred Pepsi when they did not know the brands they tasted, but they preferred
Coke when they did know, seemingly because of all the strong and positive associations they had with the Coke brand. The real ethical question comes down to
whether or not it is ethical for marketing to influence consumers’ preferences for a
brand they would not have chosen based on actual experience but no knowledge
of brand associations.
10. Describe the leveraging strategy for enhancing brand equity. Take a brand of your
choice and, with application of Figure 2.8, explain how that brand could build positive associations, thereby enhancing its equity, by linking itself to (a) places, (b)
things, (c) people, and (d) other brands. Be specific.
Answer:
The leveraging strategy for enhancing brand equity holds that brand associations
can be shaped and equity enhanced by leveraging positive associations already
contained in the world of people, places, and “things” that are available to consumers. The culture and social systems in which marketing communications takes
place are loaded with meaning. Through socialization, people learn cultural values, form beliefs, and become familiar with the physical manifestations, or
artifacts, of these values and beliefs. Marcom practitioners can leverage meaning,
or associations, for their brands by connecting them with other objects that already
possess well-known meaning. Students can select any brand to answer this question, and they should be aware that (a) “places” can refer to country of origin or
channels, (b) “things” include events, causes, and third party endorsements, (c)
“people” refers to employees and endorsers, and (d) “other brands” includes
things such as alliances, ingredients, company, and extensions.
11. A certain brand, Brand X, receives an average quality score of 8.3 and a salience score
of 68 percent. What is this brand’s equity score based on the EquiTrend procedure?
Answer:
Using the EquiTrend procedure, an equity score is determined by multiplying the
quality and salience scores and dividing the product by 10 so that equity scores
range between zero and 100. The equity score in this example would be (8.3 x
68)/10 = 56.4.
12. Why is demonstrating financial accountability an imperative for marcom practitioners?
Answer:
Two primary motivations underlie the increased focus on measuring marketing
performance. The first is from the CEO, the Board, and other executives putting
greater demand for accountability on the marketing function. A second reason is
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that CMOs must get better at what they do because it is becoming increasingly
difficult to justify expenditures without knowledge of what works and what
doesn’t.
13. Assume that your college or university has had difficulty getting nonstudent residents
in the local community to attend football games. Your school’s athletic director
requests that an organization you belong to (say, a local chapter of the American
Marketing Association) develop an advertising program that is to be targeted to local
residents to encourage them to attend football games. What measures/metrics could
you use to assess whether the advertising program you developed has been effective?
How might you assess the ad campaign’s ROMI?
Answer:
One metric could be the number of non-student tickets sold for each game
throughout the season. One way to assess the effects of the marcom program is to
use marketing-mix modeling. The data for each period could be the non-student
attendance at each game along with corresponding advertising and promotion expenditures for each program element during the time leading up to a given game.
While just looking at game attendance will let you know how successful the overall marcom program was, marketing mix modeling will allow you to determine
the relative effectiveness of each marcom element.