THE PROCESSES OF BUILDING BRAND EQUITY
This paper combines the conceptual framework of customer-based brand equity (Keller, 1993) and six-stage model of brand evolution (Goodyear, 1996) to develop the processes of building brand equity. Focuses of brand equity building are suggested for each stage. Key words: brand equity, brand knowledge, brand evolution
Successfully building, managing, and tracking the brand equity of brands are main goals of brand management. The brand strategies are flexible to fit the increasing competitive market and customers’ brand knowledge. It is more and more difficult to maintain the customer’s brand loyalty. Thus, it becomes crucial to understand brand equity and brand building processes more thoroughly in order to help brands succeed. Keller (1993) proposed a detailed conceptual model of customer-based brand equity (Figure 1). However, this framework did not indicate the processes of brand equity building. This paper employs a six-stage model developed by Goodyear (1996) and proposes the focuses of brand equity building in each stage.
Keller (1993) defines customer-based brand equity as the differential effect of brand knowledge on consumer response to the marketing of the brand. He developed a framework (Figure 1) of brand knowledge which can be divided into two components, brand awareness and brand image (a set of brand associations). Brand awareness consists of brand recognition and brand recall performance. Brand image is defined as “perceptions about a brand as reflected by the brand associations held in consumer memory”. Brand associations can be classified into three categories: attributes, benefits, and attitudes. Attributes are distinguished according to how directly they relate to product or services. One kind of attributes is product-related attributes such as the ingredients or functions of product or service. The other kind of attributes is non-product-related attributes such as price information, packaging or product appearance information, user imagery, and usage imagery. Benefits are the personal value consumers attach to the product or service attributes, for instance, functional benefits, experiential benefits, and symbolic benefits. Brand attitudes are defined as “consumers’ overall evaluations of a brand”. Furthermore, Keller (1993) also discussed the favorability, strength and uniqueness in the conceptual framework of the customer-based brand equity. [pic]
Figure 1: Dimensions of Brand Knowledge
Source: Keller(1993), Conceptualizing, Measuring, and Managing Customer-Based Brand Equity, Journal of Marketing, Vol. 57, January 1993, Page.7
PROCESSES OF BUILDING BRAND EQUITY
Goodyear (1996) proposed a six-stage model of brand development. This paper employs the model and suggests brand equity building in each stage (Table 1).
Stage 1: Unbranded Goods
In the first stage, “goods are treated as commodity goods or cases where consumers are reluctant to make brand distinctions, for example, toothpicks, clothes pins. In this stage, consumer’s memory network consists primarily of a node identifying the product category. Such goods are often seen in developing countries. Information about the product is generally limited to product uses” (McEnally, de Chernatony 1999). Consumers have little brand knowledge of the product. Brand equity barely exists in this stage.
Stage 2: Brand as Reference
In the second stage, “increasing competitive market forces product manufacturers to differentiate their goods from others” (McEnally, de Chernatony 1999). The customers are still learning about the product and the first type of knowledge is product-related information. The goal of brand management is to place the brand as having unique functional benefits, i.e. to identify the brand's functional benefits with a distinctive name thereby differentiating it from other brands. In this stage, “consumers are linking various brand...
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