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Brand Equity: An Exploratory Analysis for measuring the immeasurable

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Brand Audit: an exploratory analysis for Measuring Immeasurable.
*Dr. Padmaja ** Govind Nath Srivastava
Abstract:- Brand audit is burning concept of 21st century and this concept is still under
evolution phase . It is comprehensive, systematic, independent and periodic examination to
assess the health of the brand. The present paper uses both direct and indirect approach for the
brand audit and proposes theoretical framework for qualitative and quantitative research being
used for the audit. As brand value depends more on intangible value and it lies in the mind set of
customers so the perception, thoughts, belief, image and emotional attachment of the customers
were investigated apart from reviewing the actual impact of brand knowledge on consumer
response. Efforts were also being made to review and examine subjective attributes associated
with the brand.
Key words- Emotionality, Brand equity, ROMI, Brand inventory.

1: Introduction- Branding is long term affair and 70% of the marketing expenditure may be
used to improve the brand equity. Brand with the distinction and continuously enhanced value
offers sustainable competitive advantage to the firm .Today in the market place battle is fought
between the brands not between the companies .Brands are valuable, tradable, renewable and
lasting asset and it delivers value to the firm. As brand is company’s strategic asset and it is
combination of company’s promotional, distribution and service efforts, so brand audit examines
different aspects of the brand based on brand inventory. A brand audit is more externally
consumer focused exercise that discovers the sources of brand equity and suggests ways to
improve and leverage it.
Brand equity and brand audit are closely linked with each other. Brand equity is financial
concept and it is combination of asset and liability associated with the brand. This concept is still
under development phase and no globally acceptable definition is available.
“Brand equity is monetary worth of all the attributes that the brand carries”. Most of the
companies do not show brand equity in their balance sheet due to subjective attributes of the
brand. From a behavioral view point, brand equity is critically important to make points of
differentiation leading to competitive advantages based on non-price competition. From
marketing point of view high brand equity provides platform to launch new brand as brand name
carries high credibility. High brand equity also works as like a shield and protect the brand
against any competing attack.
Increase in marketing expenditure increases the brand equity which ultimately influence the
brand value. The impact of increase in marketing expenditure creates different impact on
different brand and that is why companies are calculating return on marketing investment.

According to Aakar (1991), brand equity is the set of assets and liabilities linked to a brand that
add to or subtract from its value to the consumers and business. Farquhar (1989) defined brand
equity as the monetary value added by the brand to the product . Swait et al. (1993) defined
brand equity as the consumer’s implicit valuation of the brand in a market with differentiated
brands relative to a market with no brand differentiation.

Brand audit takes into the consideration qualitative as well as quantitative attributes of the brand.
The qualitative attributes of the brand include attitudinal and behavioral loyalty of the customers
while quantitative attributes contains market share of the brand, market ranking and revenue
generated by the brand. For effective brand audit, it is essential to understand the gravity of
customer loyalty. The value of the brand is derived from loyalty of the customers which includes
emotional attachment, love, and positive attitude to remain in the relationship even in the price
hike. These subjective elements need to be diagnosed for the assessment of the brand from the
customer’s perspective. It is important to note that the value of the brand should be more based
on perceived value of the customers and social pathology and individual psychology should be
examined to review the demonstrative impact of the brand over society and individuals.
For brand audit, loyalty of the customers need to be transformed into monetary terms.

Customer loyalty is psychological state that the company tries to create in the mind of the
customer. Researchers in the field of customer loyalty defined the loyalty from different
perspectives. Chip Bell pointed out that a loyal customer is one who do not just come back, he do
not simply recommend you, but he insist his friends to do business with you. Gremler and
Brown pointed out that a loyal customer is one who repurchases from the same service provider
whenever possible, who continues to recommend and who maintain positive attitude towards the
service provider”.
Zeithmal integrated various researches in the field of customer loyalty and described customer
loyalty in terms preference of the customers, continuing relationship with the brand and positive
attitude. Selnes( 1993) stated that loyalty is an attitude expressed in the form of readiness to
advocate the brand to others.
Brand loyalty is defined as a dedication, faithfulness, commitment, devotion to a brand. In order
to become brand loyal, the customer must perceive a particular brand as a best option and he
should have positive attitude towards that brand.
Brand audit considers customer loyalty as a multidimensional concept and take into the
consideration both attitudinal loyalty and behavioral loyalty. After analyzing the two
dimensional approach researcher insisted that focusing only on behaviour (repeat purchase) does
not give complete understanding about brand loyalty. In other words examining the behavioral
component of the customer does not confirm that whether the repeat purchase is result of
convenience /incentive or brand is really creating meaning in the life of customer.

Behavioral dimension refers to customer’s behaviour in respect of repeat purchase. Here

repurchase activities are only measure of brand loyalty and any internally held attitude causing
the behaviour is completely ignored. Attitudinal dimension of brand loyalty focuses on the
factors/causes responsible for the outcome (Purchase). In pure economic sense a loyal customer
is one who is ready to pay price premium for the particular brand and select it over the other
brands despite the fact that preferred brand does not possess differential advantage.

Brand audit examine the level of satisfaction and loyalty. Customer satisfaction is pre requisite
for brand loyalty. According to Rai Srivastava model of customer loyalty, customer loyalty is
function of satisfaction and emotion.
Customer loyalty= f (satisfaction, Emotion)

Customer satisfaction has strong impact over the future purchase intension and loyalty building.
Coyne established that loyalty and customer satisfaction share a weak relationship when
customer satisfaction is low, moderate when customer satisfaction is intermediate and strong
when customer satisfaction is high.
Fornell ( 1992) pointed out that high customer satisfaction improves customer loyalty and
reduces the price sensitivity of the customers towards competitive offering.
Jones and Sasser revealed that satisfaction loyalty relationship is neither simple nor linear and
defection also takes place among satisfied customers. Fredricks clarified the difference between
satisfaction and loyalty and stated that satisfaction is passive state of the customer while loyalty
is proactive relationship with the supplier. A satisfied customer base sends a message to others
that the brand is accepted and successful (Aaker, 1991.

1.1: Qualitative Dimension of the Brand Audit- Brand must create meaning in the life
of customers and it should be meaningful for them. The meaning of the brand is different for
different customers and it depends on variety of the factors such as profile of the customers, past
experience, knowledge and exposure.
There is common agreement among most of the researcher that customers gives high value to
emotion, love faith, dedication and belief. The value of the brand largely based on these
intangible and subjective elements of the brand. Emotion play a very important role in the brand
decision and emotion drive the decision of customers silently and unconsciously at the destiny
where customers intend to go.
John Pawle and Peter Cooper used the Lovemak grid and incorporated quantitative as well as
qualitative insight for measuring emotions. In their study they found that emotion significantly
contributes in the consumer decision making as compared to functional factor and account for 65
to 85% depending on product category. Human behavior is heavily influenced by emotions not
solely by reason. Consumers are highly emotional and intuitive in their behavior, operating
through emotional center of the brain directed by their heart and often independent of conscious
control (John Pawle and Peter Cooper).
For the brand audit the level of emotional attachment and degree of customer loyalty must be
measured. The measure of customer loyalty is different than the other measure as for measuring
the loyalty, post purchase experience is must.
Robert (2004) developed a love mark grid to understand the relationship between brand and
consumer and emphasized that brand not only need to create respect but it should also earn
respect from customers.
Heath-2001, pointed out that brand decision is not wholly rational. Consumers take the decision
via senses, emotions, instinct and intuition. He highlighted that t customers are physically not
able to take decision based on purely rational thinking. Kelvin Roberts in his study argued that
human beings are powered by emotion and whenever there is conflict between emotion and
reason emotion always wins.
Feeling of the customers (positive or negative) should be taken into the consideration by brand
auditor while evaluating the brand and for the said purpose psychometric technique should be
used. As intention determines the action, in the same fashion positive feeling leads to repeated
purchase behaviour.
Damasio (1994) pointed out that feeling boost the conscious attention and continued working
memory required for any reasoning or deciding pleasant and unpleasant feelings can help
decision makers to resolve this dilemma by invoking distinguishable frame of the mind .

It is no longer enough to explain to customers what brand can do for him, in fact firm need to
win the emotion of the customer in order to go deep inside in the heart and mind of the new
generation customers . Brand decision-making also depends on mood of consumers.

Several studies have shown that in a happy mood, customers are more driven by their first
feeling and emotion and they take quick intuitive judgment. Intuitive decision-making is
characterized by sense by which customers perceive an option better than another. The customers
are not necessarily able to find out the source of this intuition. Sad individuals are strongly
persuaded by strong arguments, but not by weak arguments, whereas happy individuals are
moderately persuaded by strong as well as week arguments (Marieke D Vries, Rob W. Holand
and Cilia L.M. Witte man).
The way consumer experience emotion determines his behavioral intention (Yach and
Spangenberg-2000). It is pointed out that Positive emotion creates approach behavior while
negative emotion produces avoidance behavior.

2: Review of Literature- Academic literature clearly addressed the importance of building

a strong emotional relationship between consumers and brands . Positive brand feelings such as
joy, warmth, affection, excitement are critically important to build strong consumer based brand
equity that increases the monetary worth of the brand. Recent literature on branding has argued
that an emotional brand experience is important to foster brand loyalty and purchase intentions.
Brand equity provides a sustainable competitive advantage as it enables the firm to compete
based on brand value other than offering a lower price. Price leadership strategy neither builds
the brand nor increases the value of the brand. Offering the brand at lesser price is not
sustainable as it initiates price war in the market place. Secondly it decreases the profitability
ratio of bottom of pyramid.

There are two different perspectives on brand equity, company-based brand equity and
consumer-based brand equity. Consumer-based brand equity is used in the present study.In the
present study, perception of customers in decision making process was taken into the
consideration keeping in mind emotionality, faith, devotion, friendliness for the brand which
ultimately determines the brand equity.
Keller (1993) presented a conceptual model of consumer-based brand equity, which proposed
that a high level of brand awareness and a favorable brand image lead to brand loyalty, which
consequently creates brand equity. Brand equity can be divided into five factors and these are:
brand association, brand awareness, perceived quality, brand loyalty, and other proprietary brand
assets.

Consumers buy the brands to satisfy specific problems, desires or needs that can be classified
into a category of functional, emotional or self-expressive needs (Aaker, 1996). Aaker (1996)
pointed out that organization should view their brand as a product, brand as an organization,
brand as a person and brand as a symbol.

The brand as product entity focuses on product features (functional benefits); the brand as a
organization and brand as a person entities focus on emotional and self-expressive benefits,
while the brand as symbol emphasize on all three benefits, namely functional, emotional and
self- expressive benefits. The companies should move beyond the functional benefits and
products attributes and develop holistic approach for devising branding strategy.
The brand audit and brand equity depends on Brand’s Value proposition that expresses three
kinds of benefits namely functional , emotional and self-expressive benefits delivered by the
brand to the consumers .Greater the value consumer will perceive, higher would be chances to
pay price premium by him.

The brand should earn the respect and win the heart of the customers as emotional benefits can
not be copied. Firm can no longer sustain its competitive edge only by focusing on functional
benefits so understanding sources of emotional arousal has become key result area. The
Emotional benefits are linked to feelings of respect, admiration, appreciation etc.for
organizations or their brands (Aaker, 1996). Emotions are strong, relatively uncontrolled feelings
that affect our behaviour (Hawkins et al., 1998: 383).
O’Shaughnessy et al. (2003) described in their book that emotions are the primordial force
behind purchases – they are inseparable from our decision-making processes and may play a
very important role (maybe even more so) in the decision-making process as does rational
behaviour .
The emotional brain is involved in the decision making process like the rational brain. It is true
that product attributes play an important role in decision making but there is common agreement
among the researcher that customer purchase decision is more driven by symbolic cues than the
feature, benefits and price. Reasoning strategy does not always work and as stated by Maslow,
human behaviour is driven by unconscious forces. Purchase decision of the customer is not
always based on cause and effect relationship and customer is more influenced by intuitive
judgment as compared to deliberative judgment. Reasoning tells consumers a great deal about
the features of a product, but it is the link between reason and emotion that decides the actual
trade-offs that are made” - (O'Shaughnessy and O'Shaughnessy, 2003, ).

In addition to the emotions, self-expressive need is also important to satisfy need of the
customers. . The closer the distance between what the consumer thinks the brand expresses and
how they desire to express themselves, the stronger the affiliation with the brand (Aaker, 1996).
The decision to purchase one particular brand over a competing brand is not necessarily based on
value proposition of the brand. The preference of a customer for a particular brand depends on
ability of the brand to project his community nicely. Customer buys luxury car such as BMW not
to satisfy functional need but to project his community in the society. Social cue, symbolic cue
and self-expressive needs are critically important for selecting a brand over competing brand.
People act differently in different situations, as they are influenced by social roles and cues, and
they have a need for self-presentation, therefore they will use different brands to express
different personas of themselves.
Different kinds of personalities lie in one person so the same person act differently depending
upon the role, situation and self-expressive need. A business executive wears different types of
apparel at different occasion. Brands work as like a tool for self-reflection and people are
influenced by brands which can characterize their personalities and express themselves in the
manner that they view themselves.

An important part of self-expressive needs, as well as emotional needs, is the brand imagery.
Brand imagery deals with the extrinsic properties of the product / service, including the ways in
which the brand attempts to meet consumers’ psychological or social needs (Keller, 2003: 83. )
A brand that establishes relationship with the consumer and satisfy both emotional and
functional need will be in the eyes of customers.

Organization should have emotional connection with the customer and it should express it
consistently at every touch points and express it consistently across every touch point with the
consumer in order to create a positive and memorable brand experience. The efforts of branding
do not stop at customer satisfaction. The brand should do something more than just offer
functional benefits. The development of the love construct brings important insight about feeling,
emotional attachment of the customers with the brand. Caroll and Ahuvia pointed out that Brand
love is the degree of passionate emotional attachment a satisfied consumer has for a particular
trade name. Results from these studies indicate that the more brand love experienced by satisfied
consumers, the more brand loyalty and positive word of-mouth publicity.

From the above discussion this can be concluded that love, passion and emotion increases the
value of the brand and the brand which offers both emotional and functional benefits would be in
the eyes of customers.
 Objectives of the Study- Followings are the main objectives of this study
1- To explore different elements of qualitative dimension of the brand affecting brand value.
2- To compare intuitive judgment with Deliberative judgment with special reference to brand
decision in order to assess relative frequency of these decision in brand choice.
3- To study the comparative analysis of emotional benefits with functional benefits in order to
analyze the magnitude of these benefits and to assess the impact of these benefits over the brand
value.
4- To examine qualitative research techniques for measuring the intangible aspects of the brand
value.
5- To find out gap in the existing study through extensive literature review of existing literature.
6- To analyze the association between qualitative dimension of the brand.

3: Research Methodology- Qualitative research Technique has long history in marketing

research. Ernest Dichter used psychoanalytic technique to understand the purchase behaviour of
the women for automobile product. Qualitative research identifies brand association and decode
the inner insight and unconscious thought of the customers .In the present study qualitative
research techniques such as word association test, Projective technique was used to explore
various factor influencing the brand and to analyze the impact of these factors over the brand
value. Qualitative research technique was used for the study as purpose of this study is to explore
new idea related with intangible demonstrative influence of the brand that significantly
determines the value of the brand.

For the study only 27 respondents were carefully selected for the study .These respondents have
positive inclination for a particular brand and we tried to find out reason behind this inclination
so that factors influencing brand value could be obtained. To conduct the study open ended
question was used and small scale exploration research was carried out to explore appropriate
question for the study. Small scale exploration research is used as we were not sure about the
kind of questions that need to be asked from the respondents.
For collecting the data , depth interview and focus group interview was used and enough time
was spend on each respondents to uncover their unspoken desire, hidden motive, social and
symbolic cue. An informal, unstructured and lengthy interview was carried out between the
respondents and interviewer and respondents were encouraged to talk freely about their emotion,
belief and attitude. The time duration for depth interview was 30 minutes for each respondent.

Focus group interview was also conducted for the study as it is popular technique for exploratory
research. Before administering the interview, a brief idea was given to the respondents for the
discussion. Respondents talked freely about their feeling, experience, motive and inclination
related with the brand. The new idea which emerged during the focus group interview was
incorporated in the study. Total seven questions were framed for the study and these question are
related with Emotionality, friendliness with the brand, advocacy for the brand, willingness to pay
price premium, attitude to ignore the limitation of the brand, sustainability of relationship,
Attitude to remain loyal in the adverse condition. All these questions are subjective in nature and
intend to discuss intangibility aspects of the brand. The validity of the questionnaire was tested
by content validity test.

Projective research technique such as word association test, sentence completion test, TAT test
was used to understand the nature, subjectivity, magnitude of the relationship between the
customer and the brand.

4: Analysis - When projective research technique such as word association test, and sentence
completion test was administered, it was found that most of respondents reflected their emotional
feeling and they admitted that, in most of the cases they buy the good due to emotional reason.
Secondly in most of the cases when the question was asked regarding reason behind purchasing a
particular brand, majority of the customers could not define exact reason behind the purchase
decision, this shows that unconscious motivation play an important role .
 It was also found from the TAT test , that customers expressed their inexpressible need when
ambiguous stimuli was shown to them .Result shows that customers value love, affection ,
emotionality associated with the brand.

5:Findings- The result drawn from the projective research technique reveals that emotional
needs are complex and the association between the brand and customer play an important role
in branding decision of the customers and it has prominent impact over the brand value.The
present study indicates that brand value depends more on intangible value of the brand and
customers rate the brand beyond the functional benefits of the brand.

References-
Blair Kidwell, David M. Hardestyand Terry L.Childers ‘consumer emotional intelligence’,
Advances in consumer research, vol-35, 2008
Lennifer S.Lerner, Seunghee Han and Dacher Keltner ‘Feelings and consumer decision making-
Extending the appraisal tendency framework’, Journal of consumer psychology
Marieke D vries, Rob W.Holand and Cilia L.M.Witteman ‘Fitting decisions: Mood and intuitive
deliberative decision strategy’ , Psychology press
Jennifer J.Argo, Darren W. Dahl and Andrea C.Morales ‘Positive consumer contagion:
Responses to attractive others in a retail context’, Journal of marketing research, vol-xlv, dec-
2008, pp-690-701
Ingrid Smithey Fulmer and Bruce Barry ‘Managed hearts and Wallets: Ethical issues in
emotional influence by and within the organisation’, Business ethics quarterly 19.2, April-2009

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