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2.1

CHAPTER 2:CHAPTER 2:

CUSTOMERCUSTOMER--BASED BRAND EQUITYBASED BRAND EQUITY

Kevin Lane KellerKevin Lane Keller

Tuck School of BusinessTuck School of Business

Dartmouth CollegeDartmouth College

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2.2

CustomerCustomer--Based Brand EquityBased Brand Equity

The differential effect that brand knowledge hasThe differential effect that brand knowledge has

on consumer response to the marketing of thaton consumer response to the marketing of that

brand.brand.

Keller, 1993Keller, 1993

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2.3

CustomerCustomer--Based Brand EquityBased Brand Equity

Differential effectDifferential effect

Differences in consumer responseDifferences in consumer response

Brand knowledgeBrand knowledge

A result of consumers knowledge about the brandA result of consumers knowledge about the brand

Consumer response to marketingConsumer response to marketing

Choice of a brandChoice of a brand

Recall of copy points from an adRecall of copy points from an ad Response to a sales promotionResponse to a sales promotion

Evaluations of a proposed brand extensionEvaluations of a proposed brand extension

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2.4

Brand Equity as aBrand Equity as a BridgeBridge

Reflection ofReflection ofpastpast investments in the marketing ofinvestments in the marketing of

a branda brand

Direction forDirection forfuturefuturemarketing actions ormarketing actions orprogramsprograms

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2.5

Making a Brand Strong:Making a Brand Strong:

Brand KnowledgeBrand Knowledge

Brand knowledge is the key to creating brandBrand knowledge is the key to creating brand

equity.equity.

Brand knowledge consists of a brand node inBrand knowledge consists of a brand node inmemory with a variety of associations linked tomemory with a variety of associations linked to

it.it.

Brand knowledge has two components: brandBrand knowledge has two components: brand

awareness and brand image.awareness and brand image.

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2.6

Sources of Brand EquitySources of Brand Equity

Brand awarenessBrand awareness

Brand recognitionBrand recognition

Brand recallBrand recall Brand imageBrand image

Strong, favorable, and unique brand associationsStrong, favorable, and unique brand associations

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2.7

Brand Awareness AdvantagesBrand Awareness Advantages

Learning advantagesLearning advantages

Register the brand in the minds of consumersRegister the brand in the minds of consumers

Consideration advantagesConsideration advantages Likelihood that the brand will be a member of theLikelihood that the brand will be a member of the

considerationsetconsiderationset

Choice advantagesChoice advantages

Affect choices among brands in the considerationAffect choices among brands in the consideration

setset

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2.8

Establishing Brand AwarenessEstablishing Brand Awareness

Increasing the familiarity of the brand throughIncreasing the familiarity of the brand through

repeated exposure (for brand recognition)repeated exposure (for brand recognition)

Forging strong associations with the appropriateForging strong associations with the appropriateproduct category or other relevant purchase orproduct category or other relevant purchase or

consumption cues (for brand recall)consumption cues (for brand recall)

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2.9

Creating a Positive Brand ImageCreating a Positive Brand Image

Brand AssociationsBrand Associations

Does not matter which source of brand associationDoes not matter which source of brand association

Need to be favorable, strong, and uniqueNeed to be favorable, strong, and unique Marketers should recognize the influence of theseMarketers should recognize the influence of these

other sources of information by bothother sources of information by both managingmanagingthemthem

as well as possible and by adequatelyas well as possible and by adequatelyaccountingforaccountingfor

them in designing communication strategies.them in designing communication strategies.

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2.10

The Four Steps of Brand BuildingThe Four Steps of Brand Building

1.1. Ensure identification of the brand with customers andEnsure identification of the brand with customers and

an association of the brand in customers mindsan association of the brand in customers minds

2.2. Establish the totality of brand meaning in the minds ofEstablish the totality of brand meaning in the minds of

consumersconsumers3.3. Elicit the proper customer responses to the brandElicit the proper customer responses to the brand

identification and brand meaningidentification and brand meaning

4.4. Convert brand response to create an intense, activeConvert brand response to create an intense, active

loyalty relationship between customers and the brandloyalty relationship between customers and the brand

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2.11

Four Questions Customers ask of BrandsFour Questions Customers ask of Brands

1.1. Who are you? (brand identity)Who are you? (brand identity)

2.2. What are you? (brand meaning)What are you? (brand meaning)

3.3. What about you? What do I think or feel aboutWhat about you? What do I think or feel aboutyou? (brand responses)you? (brand responses)

4.4. What about you and me? What kind ofWhat about you and me? What kind of

association and how much of a connectionassociation and how much of a connectionwould I like to have with you? (brandwould I like to have with you? (brand

relationships)relationships)

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2.12

CustomerCustomer--Based Brand Equity PyramidBased Brand Equity Pyramid

RESONANCE

SALIENCE

JUDGMENTS FEELINGS

PERFORMANCE IMAGERY

4. RELATIONSHIPS =

What about you and me?

3. RESPONSE =

What about you?

2. MEANING =

What are you?

1. IDENTITY =

Who are you?

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SubSub--Dimensions of CBBE PyramidDimensions of CBBE Pyramid

LOYALTY

ATTACHMENT

COMMUNITY

ENGAGEMENT

QUALITY

CREDIBILITY

CONSIDERATION

SUPERIORITY

WARMTH

FUNEXCITEMENT

SECURITY

SOCIAL APPROVAL

SELF-RESPECT

CATEGORY IDENTIFICATION

NEEDS SATISFIED

PRIMARY CHARACTERISTICS &

SECONDARY FEATURES

PRODUCT RELIABILITY,DURABILITY & SERVICEABILITY

SERVICE EFFECTIVENESS,

EFFICIENCY & EMPATHY

STYLE AND DESIGN

PRICE

USER PROFILES

PURCHASE & USAGE

SITUATIONSPERSONALITY &

VALUES

HISTORY, HERITAGE

& EXPERIENCES

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2.14

Salience DimensionsSalience Dimensions

DepthDepthof brand awarenessof brand awareness

Ease of recognition and recallEase of recognition and recall

Strength and clarity of category membershipStrength and clarity of category membership

BreadthBreadthof brand awarenessof brand awareness

Purchase considerationPurchase consideration

Consumption considerationConsumption consideration

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2.15

Depth and Breadth ImportanceDepth and Breadth Importance

The product category hierarchy shows us notThe product category hierarchy shows us not

only the depth of awareness matters but also theonly the depth of awareness matters but also the

breadth.breadth.

The brand must not only beThe brand must not only be toptop--ofof--mindmindand haveand have

sufficient mind share, but it must also do sosufficient mind share, but it must also do so atat

therighttimesandplaces.therighttimesandplaces.

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2.16

Product Category StructureProduct Category Structure

To fully understand brand recall, we need toTo fully understand brand recall, we need to

appreciateappreciateproductcategorystructure,productcategorystructure, or howor how

product categories are organized in memory.product categories are organized in memory.

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2.17

Performance DimensionsPerformance Dimensions

Primary characteristics and supplementary featuresPrimary characteristics and supplementary features

Product reliability, durability, and serviceabilityProduct reliability, durability, and serviceability

Service effectiveness, efficiency, and empathyService effectiveness, efficiency, and empathy

Style and designStyle and design

PricePrice

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2.18

Imagery DimensionsImagery Dimensions

User profilesUser profiles

Demographic and psychographic characteristicsDemographic and psychographic characteristics

Actual or aspirationalActual or aspirational

Group perceptionsGroup perceptionspopularitypopularity

Purchase and usage situationsPurchase and usage situations Type of channel, specific stores, ease of purchaseType of channel, specific stores, ease of purchase

Time (day, week, month, year, etc.), location, and context of usageTime (day, week, month, year, etc.), location, and context of usage

Personality and valuesPersonality and values

Sincerity, excitement, competence, sophistication, and ruggednessSincerity, excitement, competence, sophistication, and ruggedness

History, heritage, and experiencesHistory, heritage, and experiences

NostalgiaNostalgia

MemoriesMemories

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2.19

Judgment DimensionsJudgment Dimensions

Brand qualityBrand quality

ValueValue

SatisfactionSatisfaction

Brand credibilityBrand credibility ExpertiseExpertise

TrustworthinessTrustworthiness

LikeabilityLikeability

Brand considerationBrand consideration

RelevanceRelevance

Brand superiorityBrand superiority DifferentiationDifferentiation

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2.20

Feelings DimensionsFeelings Dimensions

WarmthWarmth

FunFun

ExcitementExcitement SecuritySecurity

Social ApprovalSocial Approval

SelfSelf--respectrespect

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2.21

Resonance DimensionsResonance Dimensions

Behavioral loyaltyBehavioral loyalty Frequency and amount of repeat purchasesFrequency and amount of repeat purchases

Attitudinal attachmentAttitudinal attachment Love brand (favorite possessions; a little pleasure)Love brand (favorite possessions; a little pleasure)

Proud of brand

Proud of brand

Sense of communitySense of community KinshipKinship

AffiliationAffiliation

Active engagementActive engagement Seek informationSeek information

Join clubJoin club

Visit website, chat roomsVisit website, chat rooms

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CustomerCustomer--Based Brand Equity ModelBased Brand Equity Model

Consumer-

Brand

Resonance

Brand Salience

Consumer

Judgments

Consumer

Feelings

Brand

PerformanceBrand

Imagery

INTENSE, ACTIVE

LOYALTY

RATIONAL &

EMOTIONAL

REACTIONS

POINTS-OF-

PARITY &POINTS-OF-

DIFFERENCE

DEEP, BROAD

BRAND

AWARENESS

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2.23

Brand Building ImplicationsBrand Building Implications

Customers own brands.Customers own brands.

Dont take shortcuts with brands.Dont take shortcuts with brands.

Brands should have a duality.Brands should have a duality. Brands should have richness.Brands should have richness.

Brand resonance provides important focus.Brand resonance provides important focus.

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2.24

Creating Customer ValueCreating Customer Value

CustomerCustomer--brand relationships are thebrand relationships are the

foundation of brand resonance and building afoundation of brand resonance and building a

strong brand.strong brand.

The customerThe customer--based brand equity modelbased brand equity model

certainly puts that notion front and center.certainly puts that notion front and center.