brand-asset-valuator-model

What Is The Brand Asset Valuator Model? Brand Asset Valuator Model In A Nutshell

The brand asset valuator (BAV) model measures the brand value of an organization. Developed by advertising agency Young & Rubicam, the key finding of the program was that brand value emerges only once sufficient time has passed. Put differently, brand perception develops progressively in the mind of the consumer.

Understanding the brand asset valuator model

The brand asset valuator model is the result of a research program conducted by advertising agency Young & Rubicam. The agency interviewed over 100,000 consumers in 32 countries to gauge their perception of more than 13,000 brands.

The key finding of the program was that brand value emerges only once sufficient time has passed. Put differently, brand perception develops progressively in the mind of the consumer.

This progression is explained via four pillars: differentiation, relevance, esteem, and knowledge. In the next section, we’ll take a look at each pillar in more detail.

The four pillars of the BAV model

The four pillars are arranged under two broad categories: brand vitality and brand stature.

Brand vitality

Brand vitality describes the growth potential of a brand and includes:

  1. Differentiation – or the ability of a brand to stand out from competitors. Differentiation is a powerful driver of curiosity, pricing power, and brand advocacy. While differentiation is a good starting point, it tends to decline as the brand reaches maturity.
  2. Relevance – how appropriate or meaningful is the brand to consumers? Does it meet expectations around price or convenience? The brand asset valuator model notes that there is a direct correlation between relevance, differentiation, and market penetration.

Brand stature

Brand stature describes the consumer response to a brand. As such, it reflects current brand performance and is a strong determinant of brand strategy. Brand stature includes:

  1. Esteem – or the consumer perceptions of a brand. To what extent do consumers hold the brand in high regard? Esteem is driven by two factors. The first is the public perception of brand quality and popularity. The second factor considers how the proportions of quality and popularity differ from country to country.
  2. Knowledge – the final pillar is where all brands want to be. Here, consumers are aware of the brand and understand its identity. High levels of awareness cause consumers to become intimate with a brand.

The brand asset valuator power grid

The BAV power grid can be used to capture the relationship between each of the four pillars. Power grids show the relative strengths and weaknesses of a brand, which clarifies strategic direction. They also help clarify the role of each element in a marketing mix.

On the vertical axis of the grid, the current strength of a brand in terms of relevance and differentiation is plotted. On the horizontal axis, esteem and knowledge are plotted. Both axes are measured from low to high, with a new brand starting its journey from the bottom left-hand corner and progressing through each pillar.

The grid is then divided into four quadrants, called pillar patterns:

  1. New/unfocused – describing a new brand that has recently entered the market, but occasionally an old, stagnant, unfocused, or unknown brand. Both must seek to build awareness and traction by establishing uniqueness, meaning, and personality.
  2. Niche/unrealized – this pillar pattern includes successfully emerging or momentum brands leading with differentiation. They experience healthy and consistent growth which eventually builds relevance, esteem, and knowledge.
  3. Leadership – at this point, brand leadership has been achieved with the organization enjoying increased revenue. Brand leaders display high levels of all four pillars. However, the BAV model acknowledges that most leading brands will decline if they fail to innovate and maintain a competitive advantage. 
  4. Eroded – these brands have high knowledge but low esteem, relevance, and differentiation. That is, consumers are aware of the brand but choose to shop elsewhere. In theory, the brand then becomes old and stagnant which returns it to the first pillar pattern.

Brand asset valuator model case study

Let’s conclude this article by taking a look at a brand asset valuator model case study involving tech company Apple. The Apple brand is the most valuable in the world, so it is perhaps obvious that the company occupies the leadership quadrant explained above which embodies characteristics of all four pillars.

To better understand Apple’s dominance as a brand, we’ll delve into each of the four pillars in more detail below.

Differentiation

Apple can capture attention in the cultural landscape like no other. In a now-infamous 1997 speech announcing Apple’s rebirth, CEO Steve Jobs introduced the mantra “Think Different” to his colleagues and employees. 

Brand differentiation for Apple is mostly due to product design, which has been a hallmark of the company since it was founded. When the iMac, iPod, iPad, and iPhone were released, there was nothing else on the market that could match these products for their intuitive and streamlined functionality. 

Pricing is also used to differentiate the Apple brand. While most manufacturers of consumer electronics sell lower-priced goods at higher volumes for slimmer profit margins, most of Apple’s products occupy the premium end of the market with a price proportionate to quality. Since the company has a loyal and devoted customer base, it can charge higher prices and command more attractive profit margins as a result.

Relevance

In 2021, it was announced that Apple was the most relevant brand to consumers for the sixth year running after a survey involving 13,000 consumers and 228 brands.

According to consultancy company Prophet, Apple earned near-perfect scores in the following characteristics of brand relevance:

  1. Ruthless pragmatism – Apple is a brand that continually tries to make consumers’ lives easier with consistent brand experiences and products. 
  2. Distinctively inspired – the company is trustworthy, inspiring, and modern, with a purpose to create product products that enrich the lives of its users.
  3. Pervasively innovative – Apple is always innovating to maintain its competitive advantage and meet unmet consumer needs.
  4. Customer obsessed – lastly, Apple knows what matters most to its customers and finds ways to deliver.

Apple’s brand relevance became even most robust as technology use became a necessity during the pandemic.

Esteem

The public perception of the Apple brand is extremely favorable in terms of product quality and popularity. This increases perceived value which, as we discussed earlier, means customers are willing to pay a higher price for Apple products. Product quality has obvious connotations for perceived value, but the status afforded to consumers who own Apple products also increases brand esteem in a no less significant way.

The brand asset valuator model also measures brand esteem according to the extent to which quality and popularity differ by country or culture. Considering Apple is the world’s most valuable brand with the App Store available in 175 countries and regions, these traits likely differ less when compared to other brands. Having said that, the Apple brand is most popular in wealthy markets where consumers have more disposable income. In less developed countries, Android and a slew of smaller competitors tend to be more popular.

Knowledge 

Apple has carefully and methodically built its brand for over 40 years and has consistently delivered innovative products that have enriched consumers and society as a whole. 

The company has a core identity that consumers understand and are intimate with. This has been facilitated by consistent brand attributes that have remained more or less the same throughout the company’s history. These attributes include:

  • Progressive.
  • Up to date.
  • Worth more.
  • Intelligent, and
  • Innovative.

Apple’s logo and the lowercase “i” it places before its product names are also instantly recognizable. This increases the sense of intimacy between consumers and what is a profoundly humanistic company that supports worthy causes, communities, and people.

Key takeaways:

  • The brand asset valuator model measures brand value as a logical progression based on consumer perceptions. The model is underpinned by extensive consumer research data.
  • The brand asset valuator model is based on four pillars: differentiation, relevance, esteem, and knowledge. New brands start in the differentiation phase and progress to the knowledge phase.
  • The brand asset valuator model power grid plots the relative strength or weakness of a brand. This allows the business to determine its overall brand equity and strategize accordingly.

Connected Business Concepts

Brand Essence

brand-essence
Brand essence is defined as the core characteristic of a brand that elicits an emotional response in consumers. Brand essence is unique to every business, and the most successful businesses use it to create a reliable feeling in their target audience that builds loyalty over time.

Brand Awareness

brand-awareness
Brand awareness is a measure of how familiar a customer is with a brand. The greater the brand awareness a business enjoys, the more its products and services are recognizable to its target audience, thus, in theory, augmenting its long-term strength on the marketplace. Brand awareness is a key element of an effective marketing strategy.

Brand Building

brand-building
Brand building is the set of activities that help companies to build an identity that can be recognized by its audience. Thus, it works as a mechanism of identification through core values that signal trust and that help build long-term relationships between the brand and its key stakeholders.

Brand Equity

what-is-brand-equity
The brand equity is the premium that a customer is willing to pay for a product that has all the objective characteristics of existing alternatives, thus, making it different in terms of perception. The premium on seemingly equal products and quality is attributable to its brand equity.  

Brand Positioning

brand-positioning
Brand positioning is about creating a mental real estate in the mind of the target market. If successful, brand positioning allows a business to gain a competitive advantage. And it also works as a switching cost in favor of the brand. Consumers recognizing a brand might be less prone to switch to another brand.

Brand Promise

brand-promise
A brand promise is usually one or two sentences that accurately communicates what a consumer should expect when interacting with a brand. When a business creates a brand promise, it is making a declaration of assurance. Brand promises are often seen as extensions of brand positioning statements that explain why a business exists. A brand promise then tells the consumer how a product is service is better than those of a competitor.

Main Free Guides:

Scroll to Top
FourWeekMBA
[class^="wpforms-"]
[class^="wpforms-"]