SHIVAJIRAO JONDHLE INSTITUTE OF MANAGEMENT SCIENCE AND RESEARCH

BRAND TRACKING
STUDIES
MARKET RESEARCH APPLICATIONS
THIRD SEMESTER 2010-2011

SUBMITTED TO:-
PROF. Sheetal

PRESENTED BY:-
MR. MAYUR MISHRA ( 331 )

A MARKET RESEARCH APPLICATIONS project on BRAND TRACKING STUDIES.

SUBMITTED IN PARTIAL FULFILMENT OF MASTER OF MANAGEMENT STUDIES
(MARKETING) 2010-11
S.S. JONDHALE INSTITUTE OF MANAGEMENT & RESEARCH, ASANGAON
 TABLE OF CONTENTS

Sr. No. Topic Pg No

1 Introduction To brand tracking 3
2 When do we track? 5
3 INTERPRET BRAND TRACKING MEASURES 6
4 Brand Equity Research 8
5 Trade + Home Audit Data 10
6 Price/value research 11
7 Brand Valuation 13
8 the branding mix 15
9 Bibliography 16

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Brand tracking studies allow marketers to monitor the health of the brand and
provide insights into the effectiveness of marketing programs implemented by
the company.

WHY SHOULD BRANDS BE TRACKED?

Each brand faces different issues, which often required customized tracking
surveys. Nonetheless, at Relevant Insights, we always recommend our clients to
include measurements of awareness, usage, brand attitudes, perceptions, and
purchase intent in brand tracking studies.

• Awareness: both recall and recognition measures should be collected.

They are different indicators of the strength of the competition among brands
in the minds of the consumers. A brand that first comes to mind in certain
situations is more likely to be considered than one that is only recognized
when it is prompted to the consumer.

• Usage: this can be measured through recency, frequency of usage, and

total spending in the brand, and product category. These brand tracking
measures, not only tell us about consumer shopping behavior and
preferences, but also are indicators of market share and "share of wallet,"
which is the amount of consumer spending a brand is capturing and has a
direct impact on a company's revenues and profits.
• Brand Attitudes and Perceptions: this is usually captured through
questions related to brand image and associations that consumers develop as
they experience the brand and are exposed to its positioning message through
PR, advertising and promotional programs. Many brand associations are
often beliefs about product-related attributes and benefits. However, brand
associations also include non-product-related and symbolic benefits. Product
and non-product associations, as well as those related to price and value
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are important sources of brand equity and should be part of brand
tracking studies. Some brand associations are stronger than others, are more
easily recalled and are enough appealing that they become an important
factor in a consumer's decision to buy a brand. Some brands may be
perceived as unique, but without strong and favorable brand associations,
uniqueness really doesn't matter (Keller, Strategic Brand Management,
1998).
Many times, attitudes towards a brand go beyond the product to include
attitudes toward the company. We are all aware how Toyota's image has
been tarnished, not only by the car recall due to defective accelerator pedals
in several car models, but more so by how the company failed to promptly
notify car owners, ending up with a fine of $16 million imposed by the US
government. A survey conducted by Consumer Reports in February 2010
reported that the number of Toyota owners who would buy another Toyota
next time they are in the market for a new car has declined by 10 percentage
points from a survey conducted in December 2009. Another before-and-after-
the-recall study conducted by Light speed and Ad Age, also showed how the
number of Toyota owners that consider the brand reliable has decreased
significantly, indicating how fast a brand image can deteriorate when the
company doesn't react quickly enough.

• Purchase intent: measures of likelihood to buy a brand or switch to a

competitor are also indicators of brand health and should be part of brand
tracking studies, but these questions should be put in context regarding
specific product or brand, reason for the purchase, time, channel, price and
other relevant factors to the purchase decision, so they can be predictive of
actual purchase behavior.

WHEN AND WHO TO TRACK?

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Brand tracking studies usually involve collecting quantitative data from
consumers on a regular basis. One way to do it is to continuously collect
information, which allows us to control for unusual marketing activities, in the
analysis, and provide a more representative picture of how the brand stands in
consumers' mind and against competitors. However, this type of brand tracking
may not be feasible due to budget and resources constraints, and there are other
ways to do it (monthly, quarterly, annually, etc.) that can be equally effective.
When determining the frequency of data collection in brand tracking studies, we
consider:

• Frequency of product purchase: for example durable goods with long

purchase cycles can be tracked less frequently.

• Marketing activity in the product category: a category where brands

are constantly launching marketing programs and promotions should be
monitor more often.

• Level of competition in product category: highly competitive product

categories, where new products and competitors are constantly trying to
break in, should be tracked regularly.

• Stability of brand associations: brands with an established image that

don't show appreciable changes over time, can afford a less frequent brand
tracking.

Brand tracking studies are often conducted with current customers, but
monitoring non-users of the brand can prove to be invaluable to the
development of an acquisition and market penetration strategy in search for
business growth.
HOW TO INTERPRET BRAND TRACKING MEASURES?

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Given the comparative nature of brand tracking studies, brand tracking
measures tend to stay the same over time. However, they should be revised
from time to time to assess their reliability and sensibility. They may be
stable over time and thus reflect stability of brand associations, but they can also
be unable to capture important shifts in the market due to changes in
sociodemographic trends, competitive landscape and economic macro trends.

Another issue with brand tracking measures is defining what constitutes the
desirable level of a particular metric. Is a 50% level awareness good enough?
It depends. It is all relative to the product category and the competitive
environment. In low involvement product categories and those with many
competitors, it may be difficult to get very high levels of awareness and strong
brand associations, so the benchmark for what it is a good level for a metric
differs across industries and product categories.

Finally, each brand tracking study should be customized to capture the brand
associations that contribute the most to brand equity and the marketing activities
that are effective at strengthening it. The goal is to identify key drivers that have
an impact on consumers' brand choice and purchase behavior and develop
marketing tactics that can lead to brand growth and sustainability.

The role of brand tracking methodologies is to monitor the health and the value
of your brands. These are the business equivalent of taking your temperature or
reading your pulse - they can tell you quite reliably (within statistically-dictated
tolerances) whether you are ill or well, and even how ill or how well. They can
also point to certain symptoms. However, if you want to know how to get
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better, you may have to go to see a doctor (or, in this case, a
consultant/marketing research agency using sophisticated diagnostic and
prognostic techniques).

There are at least six ways of tracking your brand health (in order of increasing
cost):

1. Running top-line brand equity research to measure the customer-

perceived health of your brands
2. Buying trade + home audit data in consumer markets
3. Running pricing research to measure the price/value of your brand (a key
component in brand valuations)
4. Conducting a formal valuation of your brands
5. Measuring the impact of each constituent of the branding mix
(products/services, advertising, promotions, packaging, sales force, call
centers, business, public relations etc.) on the overall health of your
brands
6. Developing a business scorecard that can track all inputs to the financial
results of the company, and the performance of branding within that total
business mix

With the ever greater pressure on Marketing to demonstrate its contribution

towards the financial performance of the business, the emphasis will most likely
move towards greater investment in tracking mechanisms. To satisfy this trend,
more and more sophisticated measurement techniques are coming onto the
market.

Brand Equity Research

This is the cheapest of the brand tracking mechanisms, and can be very cheap if
kept to a core number of questions:
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Indeed, by asking four sets of questions, you can get a reading on:

• brand/category usage - from usage questions

• awareness/familiarity - from brand stature and intimacy questions
• brand stature - from a brand stature question
• brand intimacy - from a brand intimacy question
• a categorization of your customers and potential customers (suspect,
potential, lost customer, customer, advocate) - from brand
stature/intimacy & usage questions
• performance against your key brand attributes - from brand attribute
questions
• drivers of loyalty - by correlating your brand attribute performance scores
with your combined brand stature/intimacy scores
• association between brand loyalty & usage - by tabulating brand
stature/intimacy scores against usage categories (or using categorical
statistical techniques)

These four sets of questions are:

1. Brand/category usage:
o Which brands are you currently buying/using [within this sort of
environment/situation/mood]?
2. Brand stature:
o How would you rate the quality of the products/services of this
brand?
3. Brand intimacy:
o To what extent is this your kind of brand
4. Performance against brand attributes:
o To what extent do you agree with the following statements about
these brands?
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 Trade + Home Audit Data

In larger markets, there are often several agencies running trade audits which
work by obtaining data (increasingly Electronic Point of Sale EPOS data) from
large wholesalers/distributors/ retailers and by surveying a sample of the smaller
ones. EPOS data tend to be very accurate. Grossing up from a representative
sample of smaller distributors/retailers will inevitably be less accurate.

Alongside the trade audits, the major agencies also offer home audits, where
consumers record what goods/services they have purchased. They may also be
asked to answer a number of attitudinal questions.

Combined, they can provide:

• market share data

• sales growth/decline within a competitive context
• customer retention data
• customer loyalty (attitudinal) data

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 Price/value research

Some companies (notably Intel) commission regular price/value research that

they share with their manufacturing intermediaries.

Setting the prices for products/services within a brand is both a major

determinant of the profitability of the brand, and a marker to the customer of the
quality of the brand.

It is also important to understand that the perceived value of your brand is not
fixed or unitary - it is relative to each individual customer & to competitor
pricing within the category of products/services in which you operate. You can
increase your prices & see an increase in your sales & profits, or you can
increase your prices & see a decline in your sales & profits - it depends on how
many people accord you what level of premium, & what the competition is
doing. Generally speaking, price levels within a market are set by the brand
leader, who also benefits from the lower costs associated with selling the
highest volume.

There are two main price/value methodologies:

1. Brand/price trade-off - which works by mocking up a typical shelf of

products/services so that the customer can choose the brand + format s/he
prefers within a given repertoire at pre-specified starting prices. Each
time the customer chooses a brand, the price of that brand is increased by,
say, 5%, & the customer is asked to choose again.
2. Conjoint analysis - works by calculating the utility value of each
component of a product/service. The greater the utility value of the
product/service, the more it is worth. Like brand/price trade-off, conjoint
analysis seeks to replicate a typical purchasing environment. Unlike
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brand/price trade-off, conjoint analysis does not seek to represent the
choices by physical products/ services. Rather, the customer is offered a
series of paired comparisons or multiple comparisons, usually in the form
of cards or options on a computer screen. Conjoint analysis is especially
useful for calculating the value of individual components of a total
package (e.g. the different accessories in a car).

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 Brand Valuation

There are a number of bases on which to value a brand, depending on the

purpose of the valuation:

• market value
• brand contribution/profitability
• royalty value
• price premium

For each of these a considerable amount of internal accounting & market

information needs to be available:

• Brand accounting - the starting point is to structure your management

accounts by brand. What are the sales, what are the profits, what tangible
& intangible assets are allocated to the brand, & what is the performance
forecast for the next few years? Many, if not most, companies will not
have this information
• Market environment - if a brand has a value today, how stable is this
value? Will changing market conditions impact its value &, if so, in
which direction & to what extent?
• price premium - this could be a calculation of the actual price premium
currently charged in the market, or a research program to ascertain what
price premium could be charged if the products/services associated with
the brand were to be charged to their full market value
• Legal rights - is the ownership of the brand clean? In which categories in
which markets are the brand registered? Is the trademark disputed in any
markets? Does the business own the Internet domain name?

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At the basis of most valuations is the question -How much more profit will I
make from buying or licensing this brand than if I were to build my own brand?
The core technique for valuation is therefore a discounted cash flow chart that
measures estimated net present value over a specified number of years.

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 Measuring each constituent of the branding mix

New techniques are coming onto the market to measure the effectiveness of
each constituent of the branding mix against the desired outcomes for the brand
(be it sales/profit growth or market share).

This approach will combine data from the following areas:

• expenditure on each element of the branding mix

• Data analyzing and logging the key attributes of each element of the
branding mix. For instance, in the case of advertising, it could be timing
and weight of advertising, predictive scores collected during pre-tests,
attitudinal feedback on the advertising, the brand and competition
• sales and/or market share performance

These data will then be correlated using either statistical or neural network
(fuzzy logic) techniques, that will not only identify the inter-relationships and
sequencing of those relationships, but can also work predictively.

These techniques can only operate where there is a regular flow of data, so
linking internal cost management data, to e-commerce data, to consumer trade
and home audit data would potentially provide you with an extremely rich
picture.

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 Bibliography

1. Internet:

• Wikipedia encyclopedia.
• Search engines.

2. Books & Magzines:

• India today 2010 march edition.

• Marketing research by Cottaler, Ramaswamy.

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