5 Key Metrics to Consider When Assessing B2B Brand Equity
B2B brand studies typically executed through surveys, allow companies to benchmark their brands against competitors, through assessing awareness, value, and loyalty along the value chain.
B2B brand studies typically executed through surveys, allow companies to benchmark their brands against competitors, through assessing awareness, value, and loyalty along the value chain. Measuring brand equity in B2B markets is often a challenging process, as the variables driving brand equity can differ by geography, sales channels, customer size, buying influence, sales structure, and a host of other nuances. One of the most challenging hurdles is framing the purchase decision process, as the B2B sales journey is usually longer and more complicated than the B2C environment. Factors contributing to the complexity include the following: The products and services sold can be complicated, often necessitating training and education across the supply chain, The purchase decision often includes input from multiple departments (purchasing, manufacturing, finance, logistics, etc.) Purchase decision-makers and influencers usually have different needs: Purchasing – lowest price Manufacturing – fastest throughput, on time delivery Finance – best terms Logistics – minimal inventory, quick turns To fully undersand B2B brand equity, a study needs to include key stakeholders and variables that may influences in the purchase decision process. This is commonly addressed through segmentation. Examples of segmentation schemes may include geographic regions, business types (distributors, wholesalers, and retailers), sales volume, or end-use markets. The final survey design should incorporate the critical components of the brand across all identified segments. Components of B2B Brand Equity To fully understand B2B brand equity, address the following four measurements in your survey: Brand Awareness: degree of familiarity with the brand and what it delivers Brand Perception: attributes or feelings associated with the brand Brand Position: perception of brand vs. its competitors Brand Recognotion: has one even heard of the brand name Brand Trust: customer’s willingness to stake their reputation on recommending the brand to a colleague or friend Consider the example of Alpha Company. A survey instrument was prepared using the four measurements of brand equity as guidelines and administered by a third party. Three segments were identified and surveyed across the value chain: consumer goods companies, advertising agencies, and retail stores. In the Key Metric descriptions that follow, we present data and analysis from the retail store segment. Key Metric #1: Brand Awareness Brand awareness describes the degree of customer recognition or familiarity of a product or service by its name. Products and services with higher brand awareness usually generate more significant sales than brands with lower awareness or recognition scores. In the example below, Alpha has an awareness level of 70% among Retailers, comprised of retail stores that are very familiar with the brand or have used or currently use Alpha. Improving brand awareness has endless benefits, as it can make generating sales easier, drive more successful new product introductions, and can foster brand loyalty promoting future purchases. Key Metric #2: Brand Perception Brand Perception encompasses the feelings or attributes customers associate (tangible or intangible) with a brand; the sum of impressions left in the minds of customers before, during and after an experience with a product or a service. Brand associations are the attributes which come into a consumer’s mind at the mention of the brand name. “Luxury, longevity, and quality” are attributes associated with Rolls-Royce Motor Cars, whereas descriptors like “supportive, collaborative and doing the right thing” may be attributes of a professional services firm. In the Alpha example, the highest-rated attributes are overall product quality, support (for new product introductions and by sales reps), and a competitive price structure. Critical to building brand equity is creating a positive brand association with those attributes that are most important in satisfying the needs of the customer. Key Metric #3: Brand Position Brand Position is defined as space within a particular market that a company occupies in the mind of a customer and how it differentiates itself from competitors. Although the space a company occupies is multi-dimensional, onlt two dimensions are addressed in this example – price and quality – in the example below, where each company has carved out its unique brand position. Alpha’s position is that of high-price and high-quality, while Karma’s is also high-price but lower quality. Beta, Epsilon, and Zeta are considered high quality at a lower price. Key Metric #4: Brand Recognition Another important metric within the brand position category is brand recognition, which is a mearure of brand recall, or What brand names arhave you heard of? The chart below shows that Alpha is the brand with the highest brand name recall, earning it the most mentions in top-of-mind unaided questioning. There is value associated with customers remembering your brand name. Key Metric #5: Brand Trust A critical measure of any brand is trust. One’s willingness to recommend a company or brand to a colleague is a strong indicator of brand trust. A high level of brand trust must exist if an individual is willing to attach their professional reputation to a brand by recommending it to a peer. Based on this belief, the use of Net Promoter Score (NPS) is an excellent indicator of the level of trust that a particular brand has earned. A properly structured B2B brand survey which considers the entire purchasing journey and incorporates the 5 elements of brand equity: brand awareness, brand perception, brand position, brand recognotion: and brand trust wil provide a wholistic picture of overall brand equity.