Marketing Communications

54 CHAPTER 2 BRANDING

brands that have proved to be successful in diff erent countries are assumed to be a more

stable and robust asset. Customer loyalty accounts for 15%. Strong brands are brands with a

loyal customer base. Brands that have been supported consistently by marketing investments,

that show an increasing long-term trend and that are in markets in which branding is rela-

tively important are also assumed to be more valuable. Finally, the value of well-protected

brands is, of course, more secure.

Consumer brand equity

For a marketer, consumer brand equity is more important than fi nancial brand value. Th e

former type of brand equity, representing the ‘marketing value’ of a brand, can be measured

in diff erent ways, all of them trying to capture the extent to which the brand gives the product

extra marketing strength. Figure 2.4 presents the components of consumer brand equity.^51

Each of the brand equity factors is determined and infl uenced by marketing communications

strategy, and leads to a number of benefi ts. Th ese are discussed in the following sections. In

this section, the components of brand equity are looked at more closely.

A well-known brand is more valuable than an unknown brand. Consumers have more

faith in a well-known brand. A distinction can be made between deep and broad brand

awareness. Deep brand awareness means that the brand comes to mind easily and enjoys high

top-of-mind awareness. Broad brand awareness refers to the fact that the brand comes to mind

Table 2.2 The relative importance of brands (%)

Industry Tangibles Brand Other intangibles

Utilities 70 0 30

Industrial 70 5 25

Pharmaceutical 40 10 50

Retail 70 15 15

Info tech 30 20 50

Automotive 50 30 20

Financial services 20 30 50

Food and drink 40 55 5

Luxury goods 25 70 5

Source : Perrier, R. (1997), Brand Valuation. London: Premier Books and Interbrand Group.

Table 2.3 The brand strength index

Factor Relative importance (%)

Leadership 25

Internationality 25

Stability 15

Market 10

Trend 10

Support 10

Protection 5

Source : Perrier, R. (1997), Brand Valuation. London: Premier Books and Interbrand Group.

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