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Q) What do you think of Young & Rubicam’s Brand asset Valuator? What do you see as its main advantages and disadvantages? Ans) The Brand Asset Valuator (BAV) is a database of consumer perception of brands created and managed by Brand Asset Consulting, a division of Young & Rubicam Brands to provide information to enable firms to improve the marketing decision-making process and to manage brands better. Brand Asset Valuator and BAV also describe the Y&R group managing the database. BAV provides comparative measures of the equity value of thousands of brands across hundreds of different categories, as well as a set of strategic brand management tools for planning brand extensions, joint branding ventures, and other strategies designed to maintain and grow brand value. BAV has now been linked to a unique set of financial analytics, which allows determining a brand’s contribution to a company’s intangible value. There are four key components of brand health in BAV – the four pillars. Each pillar is derived from various measures that relate to different aspects of consumers’ brand perceptions and that together trace the progression of a brand’s development. These four components for determining brand value are – 1. Differentiation:Differentiation is the ability for a brand to be distinguished from its competitors. A brand should be as unique a possible. Brand health is built, and maintained by offering a set of differentiating promises to consumers. And by delivering those promises to leverage value. 2. Relevance:Relevance is the actual and perceived importance of the brand to a large consumer market segment. This gauges the personal appropriateness of a brand to consumers and is strongly tied to household penetration (the percentage of households that purchase the brand). 3. Esteem:Esteem is the perceived quality and consumer perceptions about the growing or declining popularity of a brand. Does the brand keep its promises? The consumer’s response to a marketer’s brand building activity is driven by his perception of two factors: quality and popularity. Both vary by country and culture. 4. Knowledge:Knowledge is the extent of the consumer’s awareness of the brand and understanding its identity. The awareness levels about the brand, and what it means, shows the intimacy that consumers share with the brand. True knowledge of the brand comes through building of the brand.

How Brands Are Built Four Primary Aspects

Brand Strength Differentiation and relevance taken together say a lot about a Brand’s strength (brand vitality). These two pillars point to the brand’s future value, rather than just reflecting its past.  When Differentiation is greater than Relevance, the brand has room to grow. This is a healthy pattern.

 When Relevance is significantly greater than Differentiation, the brand has become commoditized. Its Uniqueness has faded and price has become the primary reason to buy. This is an unhealthy pattern.

Brand Stature Esteem and knowledge together create Brand stature, which is a “report card” on a brand’s past performance and which determines the current power of the brand.  When Esteem is greater than Knowledge, and the consumer says, “I’d like to get to know you better.” Consumers have motivation to find out more about your brand. This is a healthy pattern for the brand.

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    When Knowledge is greater than Esteem, consumers are saying, “I know you more than I like you.” The brand has become too familiar and consumers have no motivation to listen to you. Too much Knowledge has become a dangerous thing.

Mapping a Brand’s Life: the Power Grid BAV uses a two-dimensional plot to measure Brand Strength and Brand Stature. The strength is measured on the vertical “y-axis” [Differentiation, Relevance] and stature is measured on the horizontal “xaxis” [Esteem, Knowledge]. The Power Grid provides a model for mapping and diagnosing the life

of a brand. New brands begin in the lower left quadrant – with low strength, low stature. As the brand develops, it rises to the upper left quadrant – where strength is significantly higher than stature. It is here where niche brands and brands with unrealized potential reside. This is high margin territory. In order to maximize shareholder value, brands should be strategically leveraged to move to the upper right quadrant, where powerful leadership brands reside. When brands get into trouble, the first thing to erode is Differentiation, causing leadership brands to decline. This loss in Differentiation reduces the ability to extend the brand across new consumer and market segments. As a result, there is a huge loss in intangible value.

Advantages of Young & Rubicam’s Brand Asset Valuator  Brand Asset Valuator is an important tool to assess a brand’s current achievements and stature. It is even more powerful when the future potential of a brand can also be measured. Y&R’s Brand Asset Valuator offers this opportunity.  Combining exhaustive amounts of consumer data with a proven model of brand-building, Brand Asset Valuator anticipates future operating earnings and operating margins. This can enhance the marketing-decision process in a variety of substantive ways.  Brand Asset Valuator can help managers understand marketplace opportunities and the types of risk that go with them. It can provide a deeper understanding of consumer behavior: for example, shedding light on reasons why some segments are willing to pay a higher price for a highly differentiated brand.  Brand Asset Valuator stands apart from other brand study aids in a number of ways. It is predictive, focusing on leading indicators instead of lagging. It is exhaustive in every way, size and scope. Most importantly, it evaluates a brand in the entire world of brands, not in its “category.”

 Brand Asset Valuator also helps to determine a brand’s elasticity and helps to explore beneficiary brand alliances.  Lastly, Brand Asset Valuator is not only just useful for creating brands. It is useful for managing brands in the long term—through ups and downs.

Disadvantages of Young & Rubicam’s Brand asset Valuator  The major disadvantage associated with Young & Rubicam’s Brand asset Valuator is that it is proprietary in nature and can be employed only by Young and Rubicam.  Another disadvantage associated with BAV is that the measures underlying the four factors may not be relevant across a wide range of product categories and thus these factors tend to be abstract in nature and might not be related directly to product attributes or benefits and more specific marketing concerns. Nevertheless, the BAV model represents a landmark study in terms of marketers’ ability to better understand what drives top brands and where their brands fit in with other brands.