Financial and Non-Financial Brand Performance Metrics - Essay Example

? Brand Marketing Table of Contents Introduction 3 Discussion 3 Question (A) 3 Question (B) 7 Conclusion 9 References 10 Introduction Brand is the design, name, symbol, term or other characteristic that generally identifies whether a product is distinct or can be differentiated from other sellers’ products. A brand is considered as an intangible asset. Effective branding strategy helps an organization to achieve several potential competitive advantages in competitive global market place (Abbing, 2010, p.79). Several leading organizations around the globe are trying to increase their core competencies through the implementation of several unique competitive strategies. This particular essay will discuss various theories in order to assess the relationship of different customers with several B2C brands. This essay will consider and evaluate various authors’ academic literature regarding a brand. Moreover, the essay will reveal how a brand can drive both financial and non financial brand performance metrics. Finally the essay will summarize and conclude the whole findings. Discussion This part of the essay will provide answers of two essay questions. Question (A) It has been discussed earlier that brand is an intangible asset. The brand owners effectively manage their brands in order to develop shareholder value. Several organizations adopt branding to differentiate their products from other market competitors. This branding is subsequently used in marketing, advertisement and business. Coca Cola is a key modern example of brand that belongs to the Coca Cola Company. Several organizations generally focus on brand valuation. Brand valuation is a key management technique which ascribes a significant monetary value to brand (Ariely, 2009, p.23). Moreover, it allows the organization to manage the marketing investments to maximize the value of shareholders. Appropriate branding strategy can result in high sales growth. For example, if a customer likes regular Coke under the Coca Cola Company, then the customer will surely try other products under the company. Brand is a significant personality that helps to identify a company or a product or a service. According to Kotler (2000), a brand can be defined as the name that is associated with one or more than one product in the specific product line of an organization (Kotler, 2000, p.396). Whenever a marketer or an organization develops a new name, design or logo for a newly developed product, he or she has developed a brand. Branding is one of the initial and important steps within the product or service marketing process. According to Urde (1999), for a longer period of time brand has been treated as the important element of a product or a service (Urde, 1999, p.197). Some individuals distinguished the psychological aspect and brand associations like feelings, perceptions, images, thoughts, beliefs, attitudes, thoughts and experiences. However, the experiential aspect consists of the sum of total points of contacts associated with the brand. This is known as brand experience. According to Baldegger (2012), this brand experience is known as a specific brand action that is perceived by an individual. Sometimes this psychological aspect can be referred as brand image. Brand image is a symbolic construct that is developed within customers’ mind (Baldegger, 2012, p.39). Brand image consists of expectations and information associated with an organization or a product or a service. It is important for an organization to carefully develop a brand management strategy. Careful brand management strategy seeks to develop products and services related to the target audience. It is important for the organizations to achieve significant brand recognition of their products and services (Browayes and Price, 2008, p.192). Effective branding strategy always increases the core competency of a product or service. A strong brand name always demand high price for the products or services as a strong brand name always develops strong brand awareness and market demand. Strong brand name helps the organizations or the brand owners to implement premium pricing strategy that enhance sales growth rate of those particular products and services. Brand awareness refers to the ability of the customers to recognize and recall a particular brand under various conditions. Effective brand awareness increases the customers’ level of knowledge about the products and services (Kotabe and Helsen, 2008, p.69). There are three different levels of brand awareness, such as Top of mind brand awareness, Aided brand awareness and strategic brand awareness. Top of mind brand awareness occurs when a brand generally pops up in the mind of customers. On the other hand, aided brand awareness generally occurs when a customer choose a brand under a list of several recognized brands. Strategic brand awareness generally occurs when a particular brand has several distinctive qualities that enhance the performance of that brand in a particular competitive market place (Bidgoli, 2006, p.41). It is important for the brand owners to understand several valuable brand elements before the development process of a brand. Name, Logo, shapes, design, sounds, colours and tastes can be considered as the brand elements. Organizations generally follow various kinds of branding strategies, such as company name branding, attitude branding, individual branding, derived branding, no-brand branding, private label branding and individual branding (Boone and Kurtz, 2009, p.91). Baseline model and augmented model can be implemented in this part of essay to understand the branding strategy. Organizations generally develop branding strategy based on the characteristics of the core product (Robinson, 2012, p.132). Baseline model helps brand owners to stick with the basic principle of the core product. For Example, Coca Cola Company follows baseline model for their regular Coke product. Several organizations used to implement this model in the branding strategy for their old and traditional products (Moore, 2010, p.31). On the other hand, augmentation model helps a brand owner or organization to differentiate their products from their baseline products. According to Brown (2004), leading organizations generally implement this strategy for effective product differentiation process (Brown, 2004, p.17). The marketers generally try to provide augmented products in order to cover the untapped market. For example, Colgate introduced new differentiated Active Salt tooth paste through this augmentation process. It helped the organization to achieve potential competitive advantage. However, augmented products force other competitors within the market place to adopt this unique branding strategy regarding product or service differentiation process (Cramer and Karabell, 2010, p.9). Brand orientation is another effective and important brand building model. This model generally focuses on brands as key strategic resources. Brand orientation is an important approach that helps the organizational processes to revolve around the development, creation and protection of a specific brand (McKay, 2010, p.21). Effective brand orientation strategy helps a brand owner to develop his or her brand in more deliberate and active manner. Understanding of the integrated and internal brand identity is considered as the starting point of the brand development process. This process helps a brand to avail a strong strategic platform that provided satisfaction framework to the target customers (Dijkman, 2008, p.93). Brand equity is another important aspect that needs to be understood by the organizations or the brand owners before the development or establishment of a particular brand. Set of several brand assets and brand liabilities associated with the brand is termed as brand equity. Name, symbol, design or logo of a brand enhances the brand equity (Ridley, 2008, p.13). Brand associations, brand loyalty, brand awareness and perceived quality are considered as the key components of brand equity (Mansvelt, 2010, p.103). Brand extension is another key aspect of branding. Several leading global organizations are implementing this brand extension strategy in order to increase the market share in global market place. However, it is quite important for the brand owners to develop a brand in a proper and strategic way (Doole and Lowe, 2008, p.79). A strong brand name can ease the business operation of an organization as it has the ability to pool more number of customers. Effective brand development process can easily increase the value of a brand in competitive marketplace. It is true that brand is a stronger asset for an organization and it is their responsibility to protect and maintain it. Question (B) The concept of brand equity is discussed in the first question. Financial value-based techniques generally extract the specific brand equality value of other asset of the firms. An effective brand development strategy helps an organization to develop significant impacts on both financial and non-financial brand performance metrics (MacLennan, 2010, p.68). Several leading organizations around the globe are continuously implementing unique competitive strategies to improve the business performance in order to enhance the business productivity. Financial growth is the major objective behind the implementation of several strategies (Lingl, 2010, p.29). Branding strategy is one of the key marketing strategies that enhance both financial and non financial growth of an organization. Strong brand name helps an organization to implement premium pricing strategy for their several branded products. It is true that only quality of a product cannot enhance the sales growth. It is responsibility of a brand owner to develop a brand in such a way that can help to increase the brand awareness in the mind of customers. Effective branding strategy and strong brand name can stabilize the financial stability of an organization. High cash flow, significant profit margin, increase in revenue, high inventory turnover, growth in market share and high sales growth are the positive results of a strong and popular brand (Lancaster and Withey, 2012, p.49). Effectual brand performance of a company or a product or a service can be measured through the above financial parameters. On the other hand, effective branding strategy can help a brand to achieve several key competencies. Potential client base and brand loyalty are key results of significant non-financial brand performance. According to Kapferer (2008), several global organizations try to increase their brand value in global market place through integration of several branding strategies (kapferer, 2008, p.56). People generally try to consume products of popular and strong brand names. However it is true that an organization, or a product or a service cannot achieve popularity without effective brand identity and brand equity. It is highly essential for a brand owner to differentiate his or her brand from other competitors in order to achieve potential competitive advantages. It is known to all that the global business market already has become saturated due to presence of several potential competitors. Therefore, unique brand developing process, strong brand equity and high brand recall can help the organizations to attain significant client base. Non-financial brand performance can be measured through the market demand, needs of customers, existing client base and production of the products for a given marketplace (Smelser and Reed, 2012, p.77). Therefore, it can be stated that effective branding strategy enhance both financial and non financial brand performance of an organization or a product or a service. Under financial brand performance, an organization can stabilize their financial position within the competitive marketplace through effective branding strategy (Slack, Chambers and Johnston, 2007, p.81). On the other hand, a valuable branding strategy can enhance the organizations’ several effective non-financial brand performances. This can develop a potential client base in global market. It can increase the value of brand in the minds of customers. Moreover, the market trend can help the organization to undertake future branding strategies. Conclusion It is clear from above discussion is that a brand is considered as an intangible asset. A brand is the design, name, symbol, term or other characteristic of a product or service that generally identifies a product or service is different from other sellers’ products. It is important for the owner of a brand to understand several in-depth aspects of branding before developing a brand. It is important for the owner or an organization to identify appropriate components of a brand for a particular product (Esty and Wnston, 2009, p.71). A brand cannot be developed effectively without proper ingredient. The owner of the brand needs to ensure effective brand identity and brand awareness. Significant branding strategy will help an organization or a product or a service to avail potential base of target customer. Inadequate brand development and branding strategy can affect the business performance of an organization. Therefore, it is important for the owners of the brands to develop and differentiate the branding strategy from other competitors in order to secure present market share and cover untapped market. It will help the organization to enhance effective business performance. References Abbing, E., 2010. Brand Driven Innovation. Manchester: AVA Publishing. Ariely, D., 2009. Predictable Irrational. London: Harper Collins. Baldegger, R., 2012. Strategy, Structure and Culture. New York: Springer. Bidgoli, H., 2006. Handbook of Information Security, Key Concepts, Infrastructure, Standards, and Protocols. New Jersey: John Wiley and Sons. Boone, L., and Kurtz, D., 2009. Contemporary Marketing. Stamford: Cengage Learning. Browaeys, M-J., and Price, R., 2008. 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