Bellomy Research Blog Strategic insights for optimal brand health and performance

Strategic insights for optimal brand health and performance In today's competitive market, strong brand health is crucial for any company striving for success. Brand health measures provide a comprehensive evaluation of a brand's health and its effectiveness in achieving business goals. By understanding the diverse aspects of brand health, businesses can make informed decisions and drive sustainable growth. Maintaining brand health requires a strategy supported by market research and advanced technology. Brands that effectively measure, analyze, and adapt their strategies based on data-driven insights position themselves to sustain their market presence, deepen their connections with consumers, strengthen brand resilience, and achieve long-term growth.What is a brand?A brand is the cohesive whole of a collection of elements. Many of these elements are obvious and instantly recognizable to us, the consumer - brand name, logo and visual identity, message and voice, and even the brand's reputation and values. However, other elements of a brand are perhaps less obvious to the average consumer: brand promise, brand experience, brand equity, brand positioning, and brand story.The brand's job is to put a unique stamp on an often quotidian product or service so that it stands apart from the rest in the hearts and minds of consumers. Put in the context of shoes, it's down to the brand to conjure Vans from canvas slip-ons, Jordans from high tops, and Crocs from colorfully perforated plastic pontoons.A brand represents specific qualities that consumers associate with a product or service. It represents an implicit agreement with consumers about said product or service. It's the embodiment of all interactions, perceptions, and associations that customers have with that product or service. Satisfied customers not only become brand advocates but also actively promote the brand through social networks, contributing to overall brand awareness. Healthy brands translate to strong customer loyalty, opportunities for premium pricing, and competitive advantage. With so much riding on the brand, monitoring its health is a strategic imperative.What makes a healthy brand? Brand health is tied to the brand's, or company's, relationship with customers. Assessing and measuring the brand's health involves understanding how well the brand is performing in relation to its promises to customers. Typically, the more customers are satisfied with a product or service and have positive experiences during interactions related to the brand, the better the brand's health.Here's how Rob Rush of Deloitte & Touche LLP has explained it: "The closer a customer experience is to the brand promise, the healthier the brand."Healthy brands engage with consumers across various channels, proactively track the state of their category and potential competitive threats, and update or refresh their products and services in alignment with customer needs and wants. These behaviors help brands remain relevant and competitive in a dynamic market landscape yielding a robust and positive brand reputation.Assessing brand health: brand health metrics Understanding a brand's overall health is critical for businesses aiming to retain existing customers and increase penetration in their respective categories. To effectively track brand health, businesses need to employ a variety of metrics beyond just financial indicators. Brand health metrics are essential indicators for assessing the overall health of a brand. Understanding key brand health metrics is crucial as they provide valuable insights into a brand's strengths and weaknesses, which can ultimately enhance business performance. Brand health assessment requires analyzing an aggregate of key metrics that will vary depending on research objectives. That said, the following are among the most common.Brand awareness Brand awareness is an individual's knowledge of a product's existence. It's a key predictor of brand health and is the foundation of many brand metrics. Purchase intent is a key metric derived from surveys that measures how likely consumers are to buy from a brand.Related measurements include:Recall is the ability to remember a brand without prompts or cues; recall implies a stronger connection than recognition.Top-of-mind awareness (TOMA) is the holy grail of brand recall. It signifies that a brand is the first to come to mind when a consumer thinks about a particular product category. TOMA is also a key indicator of brand loyalty and an important measurement overall when assessing brand health.These metrics are traditionally measured with surveys and polls designed to assess recall, recognition, and comparisons with competitive products.Brand loyalty and brand reputationCustomers who consistently buy the same brand product/service over a sustained period demonstrate brand loyalty despite factors like competition and price changes. Evaluating a brand's reputation is crucial as part of assessing overall brand health, as it significantly influences customer loyalty and advocacy. A high rate of brand loyalty develops over time through repeated positive experiences. Monitoring brand loyalty is essential to avoid the potential risk of overestimating customer commitment.A few common measurements of brand loyalty are:Repeat purchase rate: The percentage of customers who purchase the brand product over a certain period.Customer retention rate: The percentage of customers who remain with a brand over a specific period.Net Promoter Score: A quantifiable measurement of customer loyalty and satisfaction based on the likelihood a customer will recommend the brand product to others.Customer feedback, longitudinal panel data, and sales and loyalty program data often inform these metrics.Market share - a measure of brand healthAnalyzing market share lets a business gauge its competitive position and identify and adapt to changing market dynamics. Market share is often measured using survey and sales data. A rising market share commonly signifies increasing consumer preference, which usually correlates with stronger repeat purchase metrics. Typically, premium brands exhibit a higher revenue share despite smaller unit sales, while value products demonstrate the opposite dynamic. Customer satisfaction Customer experience and satisfaction are crucial for long-term brand health, as many metrics are closely tied to these aspects. Measuring brand health through various methodologies such as customer feedback and social listening is essential for understanding a brand's effectiveness in achieving business goals. Satisfaction metrics gauge post-use perceptions, which correlate strongly with repeat purchases and positive word-of-mouth. Achieving high satisfaction requires meeting consumer needs and offering distinct benefits.When satisfaction falters, the repercussions can be severe, starting a self-fulfilling cycle of poor brand health. Negative feedback reduces the potential for future purchases, leading to decreased sales. Retailers may then de-list products, further diminishing market share and repeat opportunities. By the time companies recognize the problem, it can be too late. This is why constant customer satisfaction monitoring is essential for maintaining a healthy brand.Customer satisfaction measures how well a brand meets customer expectations across various dimensions. Common metrics include overall satisfaction, product/service quality, and attitudes towards brand attributes. Traditionally, brands use consumer satisfaction surveys to measure these, but social media and review sites also provide valuable feedback. Given the complex nature of measuring consumer feedback, Bellomy's developed a comprehensive analytical toolkit that includes 'voice of consumer' metrics, satisfaction surveys, NPS tracking, and more to analyze customer feedback thoroughly.Brand equity Brand equity is a crucial component of brand health that reflects consumers' perceptions and experiences with a brand. Tracking it is essential as it provides a distinct approach to measuring a company's performance, separate from financial metrics like sales figures. It is built over time through consistent positive interactions and shapes a favorable brand reputation in consumers' minds.Key aspects of brand equity include:Recognition and loyalty: As brand equity grows, it increases a brand's potential to generate sales and foster customer loyalty.Perceived quality: Consumers' perception of a brand's quality contributes significantly to its overall equity.Market advantage: High brand equity leads to greater customer loyalty, resulting in repeat purchases and word-of-mouth referrals.New product introduction: Brands with significant equity can more easily introduce new products due to established trust and recognition.Components of brand equity measurement: brand health metricsBrand perception: This measures how consumers view aspects like brand quality and value.Brand associations: This evaluates how well consumers connect core brand assets (imagery, logos, advertising styles) to products.Measurement methods:Traditional surveys: These can capture brand attitudes through perceptual questions.Sentiment analysis: Ongoing monitoring of online and social media channels can track real-time consumer opinions and their impact on long-term equity.By understanding and measuring these aspects of brand equity, companies can better assess their brand's overall health and make informed strategic decisions to maintain and improve their market position.Market research methodologies to measure brand health Because brand health comprises multiple, diverse elements, accurately capturing a complete picture of it requires a holistic approach that can include a combination of methodologies.Focus groups and consumer surveys: These methods involve gathering a group of consumers to discuss their perceptions and feelings about a brand. Focus groups provide deep insights into consumer atti