Regression analysis: Simple Linear Regression Multiple Linear Regression
Brand Key Performance Indicators as a Force for Brand Equity Management
1. Brand Key Performance Indicators as a Force
for Brand Equity Management
JOEL RUBINSON
A measurable framework for brand equity is presented that links together financial
Vivaldi Partners
performance, loyalty, and attitudinal dimensions and for understanding the impact of a
jrubinson@
vivaldipartners.com
corporate brand on sub-brands that share the same name. This study describes
specific key performance indicator measures and, most importantly, how to
MARKUS PFEIFFER
Vivaldi Partners
mpfeiffer@
vivaldipartners.com
intelligently set targets for each measure, so that marketers can track and manage
the success of their brands. A case history for a large European telecommunications
company is presented that shows how this framework produced a very different view
of the health of the company’s brands versus prior research, one that was ultimately
accepted as correct. This study discusses organizational problems the CMO had to
address as he tried to implement this new framework, and how to generalize this
approach to other industries.
INTRODUCTION
silos prevent customer-centric thinking from tak-
Imagine the branding challenges that a CMO
ing root because a complete view of the relation-
might face as he or she first joins a new company.
ship that the company has with the customer is
The CMO is likely to start by taking stock of
probably not being obtained.
how brands are managed by each division and
The problem is compounded when there is a
brand group. What they are likely to find is that
“Master Brand,” that is, a corporate brand name
each group operates in a silo and has evolved
that is part of the brand name for each sub-brand,
different brand practices over time. The brand
service, and specific offering. Examples of this
strategy templates and planning processes proba-
kind of brand architecture include Virgin (Virgin
bly are different (or nonexistent) across groups.
Mobil, Virgin Atlantic, Virgin Megastores), Sony
Some brands will have recent brand strategy work
(what don’t they make?), and Verizon (fixed line
and others will not. The methods and measures
service, DSL, wireless). It is likely that the corpo-
that each division uses to track brand perfor-
rate brand has been pulled in different directions
mance usually are inconsistent and probably sub-
by the way that each sub-brand has evolved.
optimal. Some divisions might conduct brand
Because the corporate brand often is not marketed
trackers that produce key performance indicators
(e.g., a customer cannot subscribe to “Verizon”;
(KPI), while others do not. Among those that do,
they subscribe to Verizon WIRELESS, DSL, etc.), it
they probably are using different research proto-
might not even have a brand strategy, leaving that
cols and tracking different measures as the key
up to the sub-brands with some form of loose
indicators of brand success. The lack of corporate
cooperation.
consistency is almost certain to exist for multi-
The CMO must provide leadership to the orga-
nationals across countries. Finally, it is also likely
nization for defining how the marketing function
that there is no corporate level management of the
can help the company win in the marketplace.
customer, because the divisions are siloed. Hence,
This means the CMO must provide a compelling
DOI: 10.1017/S0021849905050208
June 2005
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2. BRAND KEY PERFORMANCE INDICATORS
framework for how to create well-
. . . “brand equity” [is] “the differential consumer re-
positioned brands, how to market them
efficiently, and how to establish proper
sponse from knowing the brand.”
KPIs, along with relevant targets for these
KPIs, to drive the organization to brand
success.
suggests that key dimensions of brand
ket share brands almost always exhibit
For a company to effectively manage
equity are linked together in a kind of
the highest levels of behavioral loyalty
and grow its brand equity, it must de-
“choreography” and that modeling these
is well known and often referred to as
velop a framework for understanding how
relationships will become critical to choos-
the “double jeopardy” effect (Ehrenberg,
brand equity contributes to financial per-
ing the right measures and for setting
Goodhardt, and Barwise, 1990).
formance, and then operationalize this
targets to create an effective brand equity
framework with a measurement system
management system.
and a way to set targets for key measures.
Linking loyalty and favorable attitudes.
“A differential response from knowing the
Then, the CMO must orchestrate organi-
Linking market share and loyalty. A “dif-
brand” implies that consumers are buy-
zational buy-in from senior management
ferential response” implies that we put
ing or staying with a certain brand be-
both at the corporate and divisional levels
behavior first and analyze attitudes in
cause of brand knowledge that produces
to play by the rules of this system.
terms of their influence on behavior. Be-
uniquely favorable attitudes toward that
In this article, the authors propose a
haviorally speaking, “loyalty” is revealed
brand on aspects that drive their choice.
measurable framework for brand equity
by a nonrandom consumer purchasing
It is impractical to think that a brand
and present a modeling approach for link-
pattern, often summarized as “customer
can stand out on every driver of choice.
ing together the dimensions of brand eq-
retention” (for subscription services) or
Hence, brand management should distin-
uity so targets can be set in a way that is
“repeat rate” (for frequently purchased
guish between those drivers of loyalty
consistent with financial goals. Then, we
products).
that have been chosen as defining charac-
give a case example where the corporate
Loyalty is a critical marker for brand
teristics of the brand positioning (“points
marketing function was able to establish
equity as the observation that large mar-
of difference”) and those that are impor-
a brand equity management system that
significantly impacted the culture and metrics across the company.
A FRAMEWORK FOR BRAND EQUITY
Conceptualization
Following the work of Keller, we define
“brand equity” as “the differential consumer response from knowing the brand”
(Keller, 2003).
This definition, which probably should
win an award as the shortest published
definition of brand equity, packs a lot of
punch into these eight words. In a way,
our framework could be called the “linkage” theory of brand equity because of
how it emphasizes the connections between aspects of brand equity. Figure 1
illustrates typical brand equity profiles
that we have seen time and time again.
The performance relationship of a leading
brand versus a number two brand, etc.
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Figure 1 Brand Equity Linkage Profiles
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3. BRAND KEY PERFORMANCE INDICATORS
tant but not ownable by the brand (“points
Without [KPI] targets, we have a brand equity measure-
of parity”). More aggressive goals should
be set for how the brand is rated on
ment system, . . . not a brand equity management system.
attributes that define its positioning (Keller,
2003).
Linking master brands and sub-brands.
The authors believe that leading brands
rize the probability that a customer will be
If the company has a master brand/sub-
shift their advertising and promotion
re-tained but the aggregated results by
brand architecture, there are some addi-
budget somewhat more toward advertis-
brand should correspond with observed
tional patterns we expect to see. The
ing. In fact, evidence has been published
retention rates to be proven valid. This is
sub-brands should have certain common-
that demonstrates that brands that build
where many brand equity measures go
alities in how they are perceived, and the
loyalty from year to year also show a
wrong, by the way. Often, the survey mea-
perceptions of the master brand should
corresponding pattern of increased adver-
sure sounds logical but simply does not
be correlated with loyalty to the sub-
tising spending over time (Johnson, 1992),
compare well with retention results across
brands, suggesting that the image of the
while brands with declining loyalty re-
brands or does not track well with changes
master brand is providing benefit to each
duce advertising budgets or advertise er-
in retention over time. Such approaches
sub-brand (Aaker and Joachimsthaler,
ratically over time. However, in total, as
have questionable validity.
2000).
a percent of sales, the marketing budget
The authors have had success with two
for leading brands is usually lower as a
different approaches—constant sum data
Linking brand equity and profitability.
percent of sales resulting in greater profit
(allocating 10 chips across alternative
If a brand is creating brand equity, it is
margins.
brands) and summating the results across
succeeding at creating loyalty based on
The bottom line is that brand equity,
three to five 5-point scale rating ques-
uniquely favorable customer beliefs. Such
“the differential consumer response from
tions. The specific choice of which ap-
brands enjoy greater market share, mar-
knowing the brand,” positively affects mar-
proach to use should be data driven from
gins, and resulting profits than a generic
keting ROI.
a benchmark study, based on which loy-
product or poorly marketed brand could
generate.
alty measure best compares to retention
Measurement
rates across brands and, when used as a
Loyalty provides the mechanism by
The next step is to translate this frame-
dependent variable regressed on attributes
which increased profit margins arise. As a
work into measures and targets. Without
as the independent variables, permits the
group, loyal customers do not require deals
properly constructed measures, we can
strongest regression model to be built.
to the same degree as less loyal customers
easily be misled about the strength of a
to stay with the brand, nor are they as
brand. Without targets, we have a brand
Measuring favorability. For the case his-
switchable in the face of competitive pro-
equity measurement system, but it is not a
tory to follow, we used 5-point scale
motions. This is most clearly observed in
brand equity management system.
attribute ratings. In other research, we
packaged goods where the average price
Because our case history is on telecom
have used an “endorsement matrix” rat-
paid for a given brand has always been ob-
services, we will describe how to con-
ing approach, where respondents check
served by the authors from consumer scan-
struct brand equity measures for a sub-
off which attributes apply to which brands.
ner panel data to be higher among more
scription service and then generalize the
Either will permit good regression mod-
loyal buyers (as measured by share of re-
discussion at the end of the article.
els to be built.
users (say 50 percent or greater share of re-
Measuring loyalty. A critical point for
lated to the loyalty measure should be
quirements for the given brand) are much
establishing valid loyalty measures is that
turned into KPIs. They should be grouped
more likely to buy the product whether or
they must operate at a respondent level
based on whether or not they are central
not it is on sale. This implies that while the
and then have the property that they can
to the brand positioning. You may also
total promotion budget might be higher in
be aggregated up and shown to align
want to group drivers by theme (e.g.,
the absolute for a leading brand, it is al-
with business results. Hence, at a respon-
products versus service quality) based on
most certainly lower as a percent of sales.
dent level, we are attempting to summa-
factor analysis and then show the attribute
quirements), presumably because loyal
Those attributes that are most corre-
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4. BRAND KEY PERFORMANCE INDICATORS
ratings as summated measures by theme.
alty, ratings on key attributes) will also be
80 percent for their brand shares to be
This is very C-level friendly.
fair and reasonable.
stable. As Figure 3 suggests, retention and
A critical research issue with attribute
The reason is that they are all linked.
acquisition rates that correspond to a tar-
ratings is whether to score brand perfor-
Let us explore some of the more impor-
get market share can be calculated. In this
mance by using the ratings from all who
tant linkages.
way, targets for retention and acquisition
can be determined based on a desired
are aware of a brand or to analyze the
ratings patterns of customers (Rubinson,
Modeling customer loyalty
market share. Once the retention targets
2005). We will provide clarity on this in
and market share
are set, the target for the respondent level
the discussion on setting targets.
Larger share brands must have greater
loyalty measure can also be set.
loyalty to support their market share
Measuring master brand/sub-brand
(Baldinger and Rubinson, 1996). Consider
Setting targets for key attributes
linkages. At minimum, it is important to
the following proof. Imagine a service
Each brand’s retention rate is the average
have a reduced set of ratings toward the
business with three major brands where
of the underlying distribution of their cus-
master brand in each study about a given
there is some churn from year to year.
tomers’ probability of being retained, as
sub-brand. That way, favorability toward
Assume that the market shares and levels
shown in Figure 4. Because 70 percent of
the master brand can be statistically re-
of churn are as depicted in Figure 2 and
brand A’s customers have an “ultra-high”
lated to loyalty for the sub-brand. The
that brands exchange customers in pro-
probability of being retained (90 per-
pattern of attribute ratings as a function
portion to share. For brand shares to be
centϩ) versus only 55 percent of brand
of the number of services subscribed to
stable, the brands must exchange equal
B’s customers, brand A has a higher re-
can also provide a lot of insight as to
numbers of buyers. However, losing the
tention rate (90 percent versus 80 per-
what it takes to create total customer loy-
same number of customers means that
cent). Hence, brand A’s leading market
alty across all services, implying loyalty
the larger share brand must have a higher
share of 60 percent is dependent on hav-
to the corporate brand. “Special” ques-
retention rate. Here, brand A has a 60
ing more customers with “ultra-high” loy-
tions are also often used to understand
percent market share, churns 6 percent of
alty (Rubinson, 1979).
the impact that bad experience with the
the market, and its retention rate is 90
Now, let us link the distribution of cus-
sub-brand might have on the corporate
percent. Brands B and C, the smaller share
tomer loyalty with patterns of attribute
brand, or the effect that corporate spon-
brands, need have retention rates of only
ratings. The only way that brand A can
sorship of worthy causes might have on
feelings toward the sub-brands.
Measuring profit impact. Any brand
equity scorecard should include business
results. It is also worthwhile to track competitive marketing activity and compare
the “A&P to sales” ratios across brands,
ranked by market share.
Setting targets
Once the measures that will constitute the
brand KPI metrics are determined, the
linkages among these measures can all be
modeled. Hence, once market share targets are established for the brand, targets
for each KPI can be established. By modeling the relationship of each KPI to market share, if the share goal is attainable,
the other targets (e.g., for customer loy-
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Figure 2 Retention and Market Share
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5. BRAND KEY PERFORMANCE INDICATORS
sustain a more desirable loyalty distribution is if its customers rate it somewhat
more favorably than brands B and C are
rated by their users, especially on those
attributes that are most important at driving choice. Figures 5a and 5b illustrate a
healthy pattern (from brand A’s perspective) and an unhealthy pattern, respectively.
Note that the difference between a
healthy and not so healthy situation for
market-leading brand A is most notable
on ratings on key drivers among customers versus those of brand B, not among all
aware, where the pattern does not look
much different. This is because of the
“big brand effect,” where a big brand’s
attribute ratings among all of those aware
of the brand will always be consistently
higher, even when there is a problem in
how customers rate their respective chosen brands.
Figure 3 Required Acquisition and Retention Targets
Linking these discussions together, we
see some telltale markers of market leadership, by studying brand A with its 60
percent market share versus competitors
that each have a 20 percent market share:
• Brand A must have a 10-point higher
retention rate than brands B and C.
• Brand A must have about 30 percent
more ultra-loyal customers than brands
B and C.
• Brand A must have higher attribute
ratings among its own customers versus competitors.
These patterns are consistent with the
brand equity linkage profiles shown in
Figure 1.
The clarity of these patterns suggests
that a model can be built to precisely set
targets for retention, percent of customers
who are ultra-loyal, and the average level
of ratings among customers on key driver
attributes, relative to how competitors’
Figure 4 Customer Retention Probabilities
users rate those brands. Furthermore, tarJune 2005
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6. BRAND KEY PERFORMANCE INDICATORS
. . . if the company has a master brand/sub-brand archi-
periencing across-the-board market share
erosion (see Figure 6 for the development
tecture, the sub-brands should have certain commonal-
in the mobile segment). As competition
was mainly price driven, it became criti-
ities in how they are perceived . . .
cal to identify positioning opportunities
that would provide unique value to customers in order to remain differentiated
from discount offerings and thereby secure the company’s margins.
gets for individual attributes can be fine-
Implementing a brand equity manage-
tuned by considering that, almost by
ment system is critical to managing one
The new CMO focused initially on un-
definition, the advantage should be greater
of the company’s most valuable assets. It
derstanding the status of the corporate
for those attributes that define the brand
will give the company a better way to
brand as well as the line of business (LOB)
positioning and might be closer to parity
inform how to position its brands, be-
brands (fixed, mobile, and internet busi-
on “cost of entry” attributes.
come a living bible of what matters most
ness) by analyzing the more than 60 dif-
To summarize, this discussion of how
for brands to succeed, enable charting
ferent brand and image research studies
measures are linked suggests how KPI
brand progress toward goals, and become
(qualitative as well as quantitative stud-
measures can be created and how targets
a tool for diagnosing and fixing a weak-
ies) that were conducted over the last two
can be set. Furthermore, if the company
ness that might be emerging.
years.
has a master brand/sub-brand architec-
We would now like to share a case
Soon he realized that the existing ap-
ture, the sub-brands should have certain
history that illustrates the challenges of
proaches to researching customers’ per-
commonalities in how they are perceived,
attempting to implement a brand KPI sys-
ceptions of the brand portfolio were
suggesting that the image of the master
tem, and ultimately, how the CMO suc-
somewhat incomplete as they primarily
brand and its benefit to each sub-brand
ceeded at getting the new system in place.
focused on classic brand image research.
should also be closely monitored. Finally,
In general, the brand’s performance on
to make this dashboard of brand equity
CASE STUDY
most image attributes looked good; in
measures as relevant as possible to senior
In 2003 the new CMO of a major telecom-
fact, the portfolio brands were leading the
management, financial measures should
munication company in Eastern Europe
category on most image attributes and
also be reported, including the ratio of
came on board. While the company had a
the dimensions that were chosen as posi-
advertising and promotion spending to
dominant share position in fixed line, mo-
tioning values (simplicity, customer focus,
sales versus estimates for competition.
bile, and internet services, they were ex-
and innovation). Also the satisfaction num-
Figure 5 Average Ratings on Driver Attributes: (a) Brand A Healthy; (b) Brand A NOT Healthy
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7. BRAND KEY PERFORMANCE INDICATORS
Figure 6 Development in the Mobile Segment
bers were favorable, in contrast to actually experiencing market share loss.
Furthermore, while each division had
brand KPIs, they were all based on auton-
• Evaluate the actual state of each brand
overall perceptions of the corporate brand
including a valid picture of their
and cross-purchase. In total, more than
performance (beyond the “big brand
8,000 consumers were interviewed across
effect”).
service areas and three countries. Both
omously created, incompatible measure-
• Identify purchase and loyalty drivers
users of the company’s brand as well as
ment methodologies. Regardless, all were
for each market segment across the dif-
competitors’ users were interviewed,
brought together into one single corpo-
ferent LOBs.
thereby drawing a complete picture of the
rate scorecard, which led to the problem
• Quantify interdependencies—that is, the
that apparently comparable KPIs were ac-
potential for brand equity transfer be-
tually coming from different research de-
tween the LOB brands.
signs. Implications on how the master
• Demonstrate the power of a strong cor-
brand and sub-brands in the portfolio in-
porate brand to an organization that
fluence each other and build brand equity
was driven by an engineering heritage
in a coherent way was not reflected in the
and culture that has not proven to an-
current measures. Despite their close vi-
ticipate customer needs and behavior
sual alignment, the divisional brands were
but rather pushed complex technology
basically treated as single brands within a
products into the market.
house of brands, neglecting any potential
• Derive a new set of brand equity KPIs
or actual synergies through brand equity
that would be more valid and become
transfer.
the foundation for an ongoing manage-
Hence, the CMO concluded that the
ment of the brands by top management
research results across divisions were in-
in line with the market share and profit
adequate to turn the business around be-
targets the CEO put into place.
market in multiple ways:
• identification of the importance of LOBspecific purchase and loyalty drivers
through multiple regression modeling
• performance data for all drivers and
brand attributes among users in comparison with all major competitors
• commitment and loyalty rates across
all relevant customer segments and their
linkage to the relevant drivers
• quantification of the brand equity transfer between the LOB brands (i.e., overall influence of one brand on other
brands and relative influence on the
attribute level)
cause the methods were inconsistent and
were not correctly tracking with share
slippage.
The brand equity research was conducted
A summated composite measure of loy-
The CMO commissioned a corporate
through CATI interviews with separate
alty was chosen based on 5-point scale
brand equity study, with the followed main
legs focusing on each division’s service
questions including those relating to com-
objectives:
area, as well as a leg that focused on
mitment, willingness to recommend, will-
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8. BRAND KEY PERFORMANCE INDICATORS
ingness to switch (negatively scored), and
The first round of results was overwhelming for some of
desire to remain a customer. This composite measure was chosen among a number
the LOBs to accept at first as they drew a very different
of alternatives because it
(but more realistic) picture of the market . . .
1. correlated best with brand-to-brand differences in measured retention rates
across brands
its market share and this was due to a 10
eling interdependencies. Corporate image
percent gap on certain major drivers. Sim-
attributes were shown to predict loyalty
ulations indicated that eliminating this un-
to each given LOB over and above spe-
favorable gap would result in gaining two
cific perceptions of that sub-brand. When
A word about the modeling approach we
share points, which would be worth 100
added into the regression model of
used for assessing the relative importance
million Euros in revenues.
attributes to the loyalty dependent mea-
2. permitted a driver model that had the
highest R 2
of attributes. A separate model was built
The results also indicated new strategic
sure, the ratings of the corporate brand
for each sub-brand. Each model was final-
directions. For example, in spite of the
accounted for 32 percent of the explana-
ized with only variables that had signifi-
price-driven market situation described
tion. By conducting similar analysis on
cant correlations to loyalty, where no
in the beginning, it became obvious (in
the divisional influence on a dependent
independent variable had an unaccept-
the mobile telephony market, for exam-
measure for the corporate brand, we could
ably high Variance Inflation Factor (VIF)
ple) that many customers look for signs
determine the influence of each divisional
(which would indicate extreme multi-
that the company cares about the cus-
brand on the corporate image. By impli-
collinearity) and where the coefficients
tomer, and this can offset not having the
cation, the impact of each division on
were all positive in order to be interpret-
least expensive rates. This learning pro-
each other division could be estimated. In
able. For this model, VIFs were in the
vided an interesting avenue for a high-
other words, for the first time, there was
1.2–2.0 range. Then, the betas (i.e., the
service/high-margin differentiation in the
strong evidence that each manager should
standardized regression coefficients) were
marketplace.
act as if “we’re all in this together” (see
used to calculate the relative importance
Figure 7).
of each variable, rather than using simple
Interdependencies among sub-brands
correlation (Hair, Anderson, Tatham, and
in the portfolio
agement board endorsed the CMO’s new
Black, 1998). All models were quite ro-
The brand equity results also enabled the
approach to brand equity management
bust, with adjusted R 2 values around 60
CMO to make the case for a strong cor-
and the chosen strategy for the corporate
percent.
porate brand that would be positioned
brand that was built from the findings of
consistently by each LOB, based on mod-
the brand equity research. A system of
The first round of results was over-
It was time to act aggressively. The man-
whelming for some of the LOBs to accept
at first as they drew a very different (but
more realistic) picture of the market that
was not influenced by the big brand effects. As previously mentioned, a leading
TABLE 1
Selected Mobile Telephony Rankings
brand should have the most favorable
attribute ratings among users. However,
among users, attribute ratings on key driv-
Model
Competitive
Key Performance Indicator
Importance
Rank
.............................................................................................................................................................
ers were actually lower in many cases
Is caring about customers
22%
3
.............................................................................................................................................................
versus the ratings of competitive brands
Good value for the money
18%
4
.............................................................................................................................................................
among their own respective users (see
Is a safe choice
14%
1
.............................................................................................................................................................
Table 1).
It was shown that the commitment to
Recommended by friends
11%
2
.............................................................................................................................................................
the brand was not sufficient to maintain
Is a technology leader
8%
1
.............................................................................................................................................................
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9. BRAND KEY PERFORMANCE INDICATORS
A limited number of KPIs were chosen: a
his goal. All LOBs were now thinking
composite measure of commitment (that
about the corporate brand the same way
was proven to relate to customer reten-
and marketing their brands in ways that
tion); key purchase drivers relating to ser-
would support common strategic values.
vice and product quality; and brand
The new culture was continually re-
attributes that were proven to correlate to
inforced by consistent KPIs. Implement-
commitment and were chosen as key re-
ing corporate brand equity tracking also
flections of the corporate and/or sub-
led to immediate savings of 5 million
brand positioning strategies.
Euros by consolidating brand equity re-
Targeted market share gains were decomposed into components (see Fig-
search from divisional marketing research
budgets.
ure 8). Reanalysis of the brand equity
Figure 7 Brand Portfolio
Interdependencies
database led to setting targets that were
CONCLUDING COMMENTS
consistent with the market share and prof-
While the case history we have shown
itability goals set by the CEO and divi-
comes from a telecommunications B2C
sional presidents. A subset of the final set
service business, the tools and concepts
brand KPIs was put into place company-
of KPIs for brand attributes is shown in
here are completely generalizable. The
wide that, for the first time, came from
Table 2. Note that the targets indicate that
biggest difference is not the relevance of
consistent frameworks and measurement
certain attributes require more dramatic
loyalty but choosing the right survey mea-
systems.
improvement than others, such as “is car-
sure(s) of loyalty. For example, consider
ing about customers,” based on the lever-
fast moving consumer goods (FMCG). The
age of that attribute and the gap that was
best loyalty measure is one that maps not
observed versus competitors’ scores.
to retention, but to share of requirements
The key steps for implementing KPIs
were as follows:
1. organizing a cross-divisional integrated
Hence, after nine months of work, the
(the share of all purchases a given brand
marketing strategy and planning team
new corporate CMO had finally achieved
has with a given consumer). We have had
that worked with corporate marketing
to coordinate the selection of KPIs, setting targets, and marketing activities
across sub-brands
2. choosing which KPIs would be consistently placed on the dashboards in each
division and corporately
3. setting targets for each KPI that would
be consistent with business goals
4. presenting the proposed system for endorsement from the CEO, so that brand
equity KPIs could be integrated into
the corporate scorecard, linked with
other metrics targeted at the improvement of performances and cascaded
down into each LOB organization—
from marketing to customer service and
product development
5. implementing a quarterly tracking of the
KPIs to monitor progress toward goals
and to report on the effects of new
marketing activities that were initiated
Figure 8 Targets for Sales
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10. BRAND KEY PERFORMANCE INDICATORS
The job of getting an organization that is used to operat-
with is competing based on features and
price. When you compete in this way, the
ing in a decentralized way to adopt consistent brand
desire for more market share leads to
more SKU proliferation and promotions
management practices is tantamount to “change
because those are the only weapons you
have. Strong brands that connect with
their customers provide another path to
management” . . .
growth. Your offerings’ value to your customers comes from much more than features and low prices, it comes from a
great success with constant sum ques-
management,” which is never easy. Divi-
tions (allocating 10 points) as a survey
sions and brand groups will be resistant
based way of approximating respondent
to the loss of autonomy, and their mar-
level share of requirements. In fact, we
keting research departments will fight hard
have validated this measure on FMCG by
for their current brand tracking research
conducting proprietary brand equity re-
methods. It is likely that the first wave
search among Information Resources Inc.
of research results using the new frame-
panelists and in another study, among
work will produce some dramatically dif-
respondents who were also maintaining a
ferent pictures of the brand’s health and
purchase diary. We have applied these
that will lead to challenges to credibility
tools to B2B markets as well as B2C, and
that need to be defended to gain organi-
we find that our brand equity framework
zational buy-in. The acid test of whether
is just as applicable; even in “rational”
or not you have succeeded is the ability
JOEL RUBINSON is managing director of advanced re-
B2B markets, we find statistical evidence
to establish brand KPIs that are corpo-
search for Vivaldi Partners, a New York–based market-
that importance of trust, leadership, and
rately consistent. It is the ultimate sign-
ing consultancy, where he has developed pioneering
relationship mean that it is not all a price
off from the divisions, and it represents
methods for brand equity measurement, customer
and features game.
a living bible that will reinforce through-
segmentation and database scoring, and forecasting
out the organization what matters at man-
the sales potential of innovative products. Prior to
aging a strong brand.
that, Mr. Rubinson had been the chief research officer
The job of getting an organization that
is used to operating in a decentralized
way to adopt consistent brand manage-
This difficult task is worth the battle.
ment practices is tantamount to “change
Without strong brands, all you are left
more enduring connection.
Strong brands require leveraging all the
brand equity at your disposal, which
means creating an effective brand architecture that can utilize the equity from a
corporate brand to fullest advantage.
Would you rather be selling bananas or
Chiquita bananas, chicken or Purdue
chicken? The profit and market share advantages are obvious and worth fighting
for.
................................................................................................
and head of product management/development for
over 20 years at The NPD Group, one of the leading
marketing research firms in the world. For most
of that time, he has served on NPD’s Executive
Committee.
Over the years, Mr. Rubinson has led the development of virtually all of NPD’s advanced analytics and
research methodologies, most notably BrandBuilder,
one of the leading brand equity modeling systems
used by many leading companies such as Procter and
Gamble, AT&T, Yahoo, Coke Foods, Lipton, Shick, Sara
Lee, Campbell Soup, and many others. He is also
acknowledged as having high levels of expertise in
category management, new-product sales forecasting,
market structure and segmentation, tracking, customer relationship marketing, and many research
methodologies. Prior to joining NPD, he led the technical research services function at Lever Brothers.
196
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June 2005
11. BRAND KEY PERFORMANCE INDICATORS
Mr. Rubinson is a sought after speaker and lec-
Ehrenberg, Andrew S. C., Gerald J.
tion communication and entertainment industries
turer. He has taught the official American Marketing
(e.g., Philip Morris, Siemens-Nixdorf, Burda Media)
Goodhardt, and T. Patrick Barwise. “Dou-
Association advanced tutorial on consumer loyalty and
and as a visiting professor for several German univer-
ble Jeopardy Revisited.” Journal of Marketing
given many talks at AMA and ARF conferences, chair-
sities. As the managing director of a German consult-
54, 3 (1990): 82–91.
ing the one on brand equity research. He has lectured
ing company, he was responsible for new business
at Columbia, NYU, Wharton, Amos Tuck School, and
development and all major client relationships. Prior
University of Rochester, among others. He holds an
to that, he worked in the financial services, media,
MBA in statistics and economics from the University
and publishing sectors.
of Chicago (where he studied under three Nobel
Hair, Joseph F., Jr., Rolph E. Anderson, Ronald L. Tatham, and William C. Black. Multi-
Dr. Pfeiffer is a regular invited speaker to industry
variate Data Analysis. Englewood Cliffs, NJ:
Prentice-Hall, 1998.
Prize winners) and a degree in quantitative methods
conferences and holds a visiting professorship at the
from NYU.
Solvay Business School in Brussels, Belgium. He
................................................................................................
earned a diploma in business administration and a
Keller, Kevin Lane. Strategic Brand Manage-
MARKUS PFEIFFER is executive director of the Munich
doctorate degree from the Center on Global Brand
ment, 2nd ed. Englewood Cliffs, NJ: Prentice-
office for Vivaldi Partners. In over eight years of expe-
Leadership at the Munich School of Management,
Hall, 2003.
rience in strategy and brand consulting, he served
University of Munich.
many international and smaller clients to solve com-
Johnson, Tod. “Seventeen Years of Brand Loy-
plex marketing and brand strategy problems. He has
a wide range of experience in developing well-founded
alty Trends: What Do They Tell Us?” PMAA
REFERENCES
Conference, March 3, 1992.
solutions to brand strategies, restructure brand architectures, measure existing brand assets, and explore
Aaker, David A., and Erich Joachimsthaler.
new growth opportunities. Specifically, his experience
Brand Leadership. New York: The Free Press,
with clients from various industries and top-level exec-
2000.
Than Market Share.” Journal of Advertising Re-
utives helps Vivaldi Partners to translate best practices into company-specific growth strategies.
Rubinson, Joel. “Brand Strength Means More
search 19, 5 (1979): 83–87.
Baldinger, Allan, and Joel Rubinson. “Brand
Prior joining Vivaldi Partners, Dr. Pfeiffer worked as
Loyalty: The Link between Attitudes and Be-
a marketing consultant for different German and inter-
havior.” Journal of Advertising Research 36, 6
Rubinson, Joel. “A Framework for Growth.”
national clients in the consumer goods and informa-
(1996): 22–34.
Marketing Research 17, 2 (2005): 15–20.
June 2005
JOURNAL OF ADVERTISING RESEARCH
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