In this second interview with Mediacodex, Andrea Tartaglia, a senior executive in the entertainment industry, shares his insights about Brand Equity.
Q: So what is brand equity?
A: I’m not going to give you the marketing definition I’ll tell you what I consider while working on brand development and strategies.
Brand Equity is the value of a brand that allows it to grow, prosper and deliver whatever the brand purpose is. In commercial terms, that purpose will be value to the company.
I imagine for other organisations that are not commercially driven it could be social value. So if you work in a pro social organisation the value of that brand will not be generating money, will be generating services to help the community, for example.
Q: How do you build brand equity?
A: As a brand expert, you build Brands through with considerate planning.
I start with defining or refining the brand objective, its purpose or purposes, and then build the plan to deliver that brand purpose in the most effective way, and in the shortest possible time.
In my view, the brand plan builds the equity of the brand, and that plan should always consider a long-term perspective.
Part of the job of Brand Managers is to protect the brand from easy short-term decisions that can undermine its purpose and think about the long-term prospects and the long-term value that the brand can deliver, which should not be compromised by anything rush short-term action.
Q: So would you would you almost say there is a contradiction in terms. You cannot have a short -erm brand equity.
A: We are making some general statements here. In my experience, there will be different objectives and different perspectives that will contribute to the brand plan that may or may not impact the equity over the long term.
For example, my business experience is mostly in marketing but I also covered sales roles and I understand both the marketing and the sales perspectives.
As a sales person, I was mostly driven by short term gains and expected the marketing teams to support that. But at the same time, as a marketing and brand manager, I had to think about the future of the brand.
There is an interesting dynamic between the two perspective: the push for immediate results and the goal to deliver steady sustainable growth. Take a pricing decision for a premium brands as an example.
A price promotion can propel sales buy might devalue the brand equity in the eyes of consumers. That short terms tactic might undermine the value of the brand long term if done too frequently. I am simplifying greatly here but I hope it explains the point.
As a marketing person I will take a view about what to do to continue to produce value with the brand over a long period of time, besides my short term commitment of hitting a certain financial goal. Therefore, I may take a more strategic approach to the marketing techniques that I use to sell and promote that brand that allow me to preserve that brand for future gains.
In general terms, we can make similar considerations for other non-commercial brands.
Q: You mentioned sales. They want results right away, and marketing which is a little bit more long-term, but give us a little bit more of an insight in terms of the friction between the two.
A: Here is an example. I worked in the movie and entertainment industry for a number of years, and I managed not only the movie distribution, but also the ancillary businesses that are driven by a movie release, and in particular licensing and merchandising. There was often a healthy debate between brand people like me the teams looking after Consumer Products.
They are tasked to deliver merchandising sales from a given entertainment property in a relatively short timeframe. That may lead to close a licensing agreement that will bring the money in the timeframe that we’re talking about, but might not be the ideal long term partner for that brand. Maybe it is not a market leader in the category. It is someone who can deliver short term sales but not long term prospects, because they are short sighted or not very strategic.
All those considerations are taken into account and there’s a dynamic conversation between the brand teams who care about the long term prospects of a brand and someone who’s driven by short term financial goals.
How we can achieve both at the same time, and what strategies were to put in place to make sure that both aspects are considered and, and both aspects are successfully carried out?
Sometimes the longevity of the brand takes priority. Some other times the short financial goal takes priority. The best scenario is when both goals can be achieved with no conflict nor compromise.
Q: You mentioned sales; how do you measure brand equity in the long run, what are your metrics?
A: Again it depends on the purpose of the brand and the phase the brand is in the planning cycle. I normally consider four phases and where the brand is in relation to those.
First is awareness. The brand needs to be known. Then I look into brand affinity, brand interest and finally “action”.
From awareness I want to build affinity with a certain consumer/audience, turn that into interest which will generate a commitment towards the brand. Hopefully that commitment is a purchase and then I want that action/commitment to repeats itself.
So you take a consumer from awareness to affinity, from affinity to interest, and from interest to a proactive action. That could be a sale, or it could be talking to someone else about the brand, for example. It could be whatever that action needs to be for the longevity of the brand. So, depending on where you are in the stages of your brand, you might need to focus on one of these four things or the other. In the case of a new brand, you need to build
Awareness. If you want to start deepening the connection of that brand with the consumers, you start working on affinity and talking about the values and the purpose of that brand, not only in absolute terms but in relation to your consumers or your audience. And then you start telling them why they should be participating proactively in that brand, doing whatever you need them to do.
Finally, you want that to generate a positive circle and ask consumers to come back to your brand, and come back in bigger numbers.
Q. And how do you measure awareness for instance I’m a new brand.
I apply different measures and KPIs for each of these four phases.
If I want to measure awareness I need to know the number of people (within a certain group which is my target consumer) who know the brand. I would do a market research and ask people if they are aware of this brand or not. And I would ask how they became aware of the brand.
Was it through advertising? Social media? Word of mouth?
Affinity is a bit more difficult to track. Awareness can be investigated with quantitative research. Affinity is most likely evaluated through qualitative research. By asking people what the perceived values of the brands are; what their relationship with the brand is; how they think about the brand in more abstract terms. And then, going further, you might ask whether they have any interest in buying the brand, or interacting with the brand, and to what point they would, for example, recommend the brand to other people.
Willingness to recommend a brand is a great metric to understand affinity, interest and propensity to buy. It shows that they actually believe in the brand, that it serves well its purpose, that they are so happy with it that they have no reservations in recommending the brand to other people.
Q: Are you talking about the net promoter score.
A: I don’t call it that way but yes. As an example.
Q: Finally, do you have an example, either your own or sometimes, you know another company or brand, have a successful brand equity creation?
A: There’s so many. In these particular times that we are living in, it has been quite interesting to see how brands reacted to the situation.
Some brands just saw the dangers of the financial pressure and decided to cut marketing investments, which is totally understandable.
Some brands are showing genuine goodwill, in a very natural way, and those brands, I think, will come out of this situation very strongly.
I am thinking about Pret-A-Manger, for example.
When restaurants were still open, they were among the first to advertise the fact that they would provide free coffee and discounts to essential workers. In a period where there are sensitivities and heightened emotions, that was a very good message; out quite early; at the beginning of the dramatic situation that we’re living.
That’s an example of how you can take a dreadful situation and turn it into something that could be, and will be I think, valuable for them in the long term. Understanding there’s a price to it, that’s fine. But I think the way that was played in terms of offering help at a time was social services are needed, was very good. And it felt natural. It felt right. There was no hesitation from the brand in doing something like this, and it was followed by a number of other brands.
In this environment, I’m interested in seeing how brands are naturally doing that.
I’ll give you another example, a little bit more left field.
I’m passionate about sports, and I’ve been in touch with a number of different organisations that promote sports. And there was one in particular that reacted very very quickly to the situation, offering virtual races and ways to for people to train completely free, as a public service.
And another one that is sending me daily messages about discounts, if I buy something. Both are good things but, guess what, I feel affinity for one brand and not the other.
I will probably not go forward with the brand that is using this situation to keep wanting to sell me things (even at a much more affordable price which is welcomed in a moment when family finances are challenged). While I am much more inclined to support that brand that is not pushy and I will be willing to spend money on them even if they are not asking me explicitly to do so.
Staying on this theme, Joe Wicks is a great example on how to strengthen the equity of a brand in a time of hardship.
And don’t get me started on Captain Tom Moore. Simply extraordinary.
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