according to y and r brand asset valuator what qre the key difference between New brand and declining brand
Answers
Answer:
A brand develops in a specific progression based on the perception of the consumers. The process of building brand is reflected through four measures or pillars:
Differentiation – It defines how a brand distinguishes itself from others and is perceived as different and unique.
Relevance – It defines if a brand is personally appropriate to consumers. If it is not, then it is difficult to attract consumers to the brand in large numbers.
Esteem – It is the regard for the brand that consumers hold.
Knowledge – It means being aware of the brand and understanding what it stands for.
Differentiation and Relevance together constitute Brand Strength; Esteem and Knowledge together constitute Brand Stature. The relationship between these pillars shows the true picture of the brand’s intrinsic value. Using these 4 measures, BrandAsset Valuator develops a Power Grid which serves as a tool for managing brands.
The PowerGrid represents the brand development cycle. The process of growth of a brand starts in the lower left quadrant where they first establish their differentiating qualities while it is not yet widely known. As the brand develops enough strength, it moves to the upper left quadrant where it needs to translate its strength into stature. However, a brand can stay as an unrealized potential by catering to the niche market. Brand leaders are present in the upper right quadrant and they need to identify their emerging competitors in the adjoining quadrant. The bottom right quadrant is the trouble area which suggests that brands have failed to maintain their core strength, that is, the differentiation which was responsible for the birth of the brand in the first place. If the brands in this quadrant remain unattended to for a long time, then they will eventually slide to the lower left quadrant and will lose esteem and fade from customers’ mind. The following are the examples of each of these categories:
Unrealized Potential: Successful emerging brands
Leadership: Brand leaders like Disney
Eroding: Commodity brands
Unfocused: New, forgotten or unknown brands
On the basis of varying relationship between the pillars, the brands are further categorized as exotic, functional, commodity, specialty, the brand of the past, badge, embarrassment. These pillar patterns are powerful diagnostic tools as they enable a brand to formulate its future strategic positioning.
In the article on Y&R BrandAsset Valuator, some brands like Boston Chicken, Starbucks, Snapple, Netscape, Disney, Kmart have been fit into the PowerGrid and their position has been compared between 1993 and 1997. For instance, Starbucks grew from a new brand to a brand with strong potential while Kmart eroded from its leadership position. Barnes & Noble and Boston Chicken had strong potential in 1993 and had begun developing into a leadership brand in 1997.
BAV is a global study as it has a very diverse sample: over 90,000 consumers across 30 countries have been interviewed. Information on over 13,000 brands has been collected on 50 different scales capturing consumer perception. Y&R's BrandAsset Valuator data are collected as percentile rank with respect to all other brands measured. This concept of BAV is unique because Y&R's findings have been substantiated by tracking the financial performance of companies. Brands which have been managed appropriately have demonstrated that they yield higher margins, profit, growth, and lower risk.
Critique:
The Y & R BAV model is a good one in the sense that it is easy to use for brand managers and can be applied to almost every type of product. Also, the brand pillars provide robust information and can be clubbed with the financial information to determine the ROI of marketing programs. The main disadvantage of Y & R BAV model is that it takes into account only customer-based brand equity and tries to link it with the stock performance and totally ignores the firm-level brand equity. Y & R must integrate current and future accounting performance of the brand in the model for a better evaluation of brand equity because, practically, stock market enthusiasts evaluate a company based on its current term accounting performance and also its future market performance.
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