Developing a brand performance measure
With no universal approach for measuring brand performance, we show how a consumer-based brand measure was developed for corporate financial services brands. Churchill's (1979) paradigm was adopted. A literature review and 20 depth interviews with experts suggested that brand loyalty, consumer satisfaction and reputation constitute the brand performance measure. Paper from Birmingham Business School.
Ten financial services organisations provided access to their consumers. Following a postal survey, 600 questionnaires were analysed through principal components analysis to identify the consumer-based measure. Further testing revealed this to be a valid and reliable brand performance measure.
The literature shows a plethora of ways of interpreting brand performance (e.g. Ambler, 2000; Aaker, 1996). The significant interest in brand valuation (e.g. Perrier, 1997) has in part encouraged managers to focus on a single measure of brand performance. However, this output perspective overlooks the richness of information available from some of the intermediate indicators about why a brand has a particular financial value (Feldwick, 1996).
Through knowledge of the attributes constituting brand performance, managers are better equipped to develop more effective brand strategies. Just as a doctor assesses a patient’s health by measuring various parameters, for example blood pressure, weight, body temperature, so brand marketers are more informed by having data on the characterising dimensions of their brand (cf Mitchell, 2001).
A universal brand performance measure is appealing, but metrics vary between business sectors (Ambler, 2000) and according to the objectives set (Srivastava et al., 1998). This paper explains how a parsimonious, valid and reliable brand performance metric was developed for brands in different sectors of financial services. We focused on financial services as they represent one of the biggest services sectors (Lovelock, 2000). The paper is not about developing yet another measure of brand equity, but how a multi-item brand performance measure was developed, akin to consumer-based brand equity. With the limited research into services branding (van Riel et al., 2001), it seeks to advance knowledge by investigating financial services brands, which are an important subset of services brands. Researchers in other services sectors could follow the process we employed to devise brand performance metrics for their services sector.
The paper opens by reviewing the literature on business performance measures, since corporate success depends on corporate brand success. Given that performance measures for financial services brands are characterised by many vague elements, a broad consideration of the literature has to take place. The authors consider why there is no standard business performance measure and propose that when assessing brand performance, a measure akin to consumer-based equity be employed. The paper draws on Churchill’s (1979) paradigm to devise a brand performance measure, and explains why we selected brand loyalty, satisfaction and reputation as the components of this measure. The data collection procedure is elucidated and, following the use of principal component analysis, the specific operationalisation of financial services brand performance is presented. The measure is shown to exhibit strong psychometric properties.
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