Take Your Brand From Good To Great
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1. The document discusses how to measure and create financial value through strong brands. 2. It introduces metrics like brand power, premium, and potential to quantify a brand's equity and how that drives returns. 3. Strong brands provide customers with meaningful experiences that are different and salient, building predisposition to choose the brand and pay a premium. Amplifying these brand strengths grows financial value.
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Take Your Brand From Good To Great
- 1. March 7th 2013 Nigel Hollis 1
- 2. 90% of the world’s LEADING BRANDS 2
- 3. Agenda 1. Measuring Financial Value 2. Creating Financial Value 3. Measuring the drivers of Financial Value 3
- 4. How much is this brand worth? US$1.6 Billion
- 5. Strong brands outperform their peers BrandZ™ Strong Brands Portfolio vs. S&P 500 (Apr 2006 - Dec 2012) 60% 51.1% 40% 20% 15.3% 0% Apr 06 Aug 06 Dec 06 Apr 07 Aug 07 Dec 07 Apr 08 Aug 08 Dec 08 Apr 09 Aug 09 Dec 09 Apr 10 Aug 10 Dec 10 Apr 11 Aug 11 Dec 11 Apr 12 Aug 12 Dec 12 -20% BrandZ™ Portfolio S&P 500 -40% Source: Bloomberg; MB Optimor London Analysis -60%
- 6. Valuing a brand is more than just guesswork BRANDED EARNINGS $ What proportion of a company’s earnings can be attributed to a brand? BRAND CONTRIBUTION % How much of these earnings are due to the brand’s close bond with it’s customers? BRAND MULTIPLE M What is the growth potential of the brand-driven earnings?
- 7. Guesswork! 7
- 8. What is the world’s most valuable brand worth? $182bn $77bn
- 9. What is the world’s most valuable brand?
- 10. Which brand is the more valuable? $74bn $95bn
- 11. Which is worth more? $34bn $17bn
- 12. Which is the world most valuable financial brand? $42bn $38bn
- 13. Which declined more between 2011 and 2012? -17% -18%
- 14. Which increased most between 2011 and 2012? +61% +74%
- 15. Which brand is worth more? 11.5bn 9.3bn
- 16. Coke is the worlds largest cpg brand. What comes next? $15bn $18bn
- 17. Global Top 10 in 2012 1. $183bn 6. $74bn 2. $116bn 7. $74bn 3. $108bn 8. $69bn 4. $95bn 9. $49bn 5. $77bn 10. $47bn
- 18. The importance of brand equity differs by category
- 19. Agenda 1. Measuring Financial Value 2. Creating Financial value 3. Measuring the drivers of Financial Value 19
- 20. Brands can create value in 4 ways Creating demand for the Commanding a brand or service now premium now Financial Value Growth Extending to new uses, Creating the potential to grow countries and categories future market share
- 21. Brand What What the consumers brand does experience and and says remember 21
- 22. Meaningful 22
- 23. 23 Different
- 24. Salient 24
- 25. Strong brands offer a meaningfully different experience Purpose Resonance Meaningfully Different Experience Delivery Difference 25
- 26. Match the driver to the car Mukesh Ambani Ingvar Kamprad Prince Alwaleed bin Talal Alsaud Worth: $30bn Worth: $23bn Worth: $20bn Rolls Royce Phantom Mercedes Maybach 62 Volvo 240 GL 26
- 27. IKEA: largest retailer of furniture in the world
- 28. IKEA’s purpose is to create a better life for people…but how? By removing squeezing out every cent from the design, manufacturing and transport of its products. Prices fell by 2.6 per cent in 2011.
- 29. Delivery: any brand needs to “mind the gap” HR Manager complains that work experience does not match brand image: "Well we have two choices. Either you make the bank a better place to work, or I can create a worse brand.“ Chris Clark Head of marketing, planning, and business strategy at HSBC
- 30. Delivery: how well the brand’s experience lives up to its purpose The more positive and distinctive sensory impressions come to mind, the more loyal people are to the brand. “The girl does not only tell it has good fragrance, NUMBER OF POSITIVE SENSES RECALLED but also teaches 70% me how to smell it 60% properly – should 50% not directly smell from the bottle, 40% but wave the 30% hands back & 20% forth to air the fragrance out, as 10% to smell the 0% perfume” 0 to 1 2 to 3 4 to 5 Source: BRANDsense survey conducted in US, UK and Japan 30
- 31. Resonance: people appreciate the brand for what it does and how it makes them feel Made by companies you can trust Are leading the way Dove Natura Offer something different 0 50 100 31
- 32. Difference: provides a reason to choose and justifies a price premium Average Potential for Average potential for brand to grow Brands that brand to grow ARE different 1.3% 15.9% Brands that AREN’T different Average potential for brand to grow -7.2% 32
- 33. The five facets of effective brand amplification 33
- 34. Strong brands amplify their meaningful difference drive financial value growth Findability Credibility Vitality Affordability Extendability
- 35. Findability: ensure your brand is everywhere people might want to find it Findability Availability Visibility 35
- 36. Tropicana’s new packaging caused revenues to decline by $30 million in 2 months
- 37. Credibility: enhance meaningful differentiation through innovation and association 37
- 38. Vitality: ensure your brand is seen as contemporary, salient, talked about and fresh in look and feel. 38
- 39. Break the mould, create something compelling & new Video title: Coca-Cola Security Cameras youtube video link: http://www.youtube.com/watch?v=auNSrt-QOhw
- 40. Challenging preconceptions and creating a sense of momentum helped Audi boost sales Six major car launches in 2008 115 But Audi remains considered but 110 not chosen 105 In 2010 the “Shock the Sheep” 100 campaign challenged the status Desire 95 quo Price 90 After shifting perceptions Audi has enjoyed strong sales growth and 85 improved margins 80 2008 2009 2010 2011 2012 40
- 42. Affordability: justifying your price point while making it accessible to more people 80 60 Relevance 40 20 0 Bought Last 2007 2008 2009 2010 42
- 43. Extendability: leveraging a strong brand into new categories and countries Dove grew from global sales of about €300M in 1990 to becoming Unilever’s first €3B brand in 2011. 1955 1965 1991 1995 1997 1998 1999 2002 2007 2010 Bar soap 1 Global expansion: launched to 55 countries between 1991- Anti-aging 1994. range Facial Deodorant cleansers Dish soap Hair care Body wash Body lotion Men’s care products 43
- 44. How successful brands drive financial value growth Define Amplify Grow Purpose Resonance Findability Meaningful Credibility Financial Difference Vitality Value Affordability Growth Extendibility Delivery Difference 44
- 45. Agenda 1. Measuring Financial Value 2. Creating Financial value 3. Measuring the drivers of Financial Value 45
- 46. BrandDynamics has evolved significantly over time 1992 2012 1996 1998 2003 2005 2009 Launch of Launch of Bonding Factor Launch Development of New BrandDynamics BRANDZ analysis of D&A Voltage2.0 model 2003 2010 Launch of the Development ‘Paw Print’ analysis of the Brand Strength Score 2010 Development of the Value Driver workshops 46
- 47. People are more predisposed brands they find meaningful, different and salient Meaningful Brand ¥ Associations Different £ € $ Brand In-market Predisposition Facilitators Salient Predisposed customers will be more likely to choose your brand, pay a premium for it and the brand will be better poised to grow market share 47
- 48. Top 100 Most Average Brand Valuable Brands Power Index 100 Power Index 171 Salient Meaningful Meaningful Salient 100 100 Power 116 127 Power 6 11 Different 124 Different 100
- 49. Handsets – France 2012 Power Index 199 Power Index 120 Meaningful 95 Meaningful Salient Salient 133 Power 120 Power 130 22 13 Different Different 240 59
- 50. South Africa 2012 Power Index 446 Meaningful 183 Salient Power 212 32 Different 162
- 51. Three new measures of brand equity A single, accurate measure of demand for the brand POWER The relative price point that the brand’s equity can support PREMIUM The likelihood that the brand will grow value POTENTIAL market share 51
- 52. Stronger brands produce better returns Average operating profit reported as a percent of revenues 16% 15% 14% 13% 12% 11% High Potential 10% Low Potential Low Power High Power 52 Source: BrandZ and annual company reports for 49 companies
- 53. How successful brands drive financial value growth Define Amplify Grow Purpose Resonance Findability Meaningful Credibility Financial Vitality Value Difference Affordability Growth Extendability Delivery Difference 53
- 54. Conclusions •Brands are the most valuable asset that many companies own – they creating lasting financial value •Brands exist in the mind – you can only assess their value and potential if you know what people think •Strong brands provide a meaningfully different experience to people – marketers must not rest until they build this •Once you have this then has to be amplified through all available channels •Vitality is a key battleground. Communications can frame your brand, build salience and talkability 54