Guest Column: Balancing brand equity and sales – Jack Klues

Guest Column: Balancing brand equity and sales – Jack Klues

Author | Jack Klues | Friday, Apr 03,2009 8:24 AM

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Guest Column: Balancing brand equity and sales – Jack Klues

In the current age of consumer control, fragmented media and ‘opt in’ advertising, it is difficult to separate marketing efforts that build brand equity from those that drive sales. As consumers retreat from traditional advertising, including ‘image’ advertising, they measure the value of a brand (and the company that created it), based on the experiences they have with the brand. Those experiences increasingly happen on a branded website, social network, mobile phone, search result, in an email, at a sponsored event or at the retail store. Arguably any of these experiences can drive a sale, and should – a successful search result, for example, may lead directly to an online sale. But these experiences are also contributing to a customer’s affinity for, and loyalty to, the brand.

More than creating the right balance between the two, marketers should focus on the full spectrum of brand experiences, and leverage Performance Marketing to move consumers along that spectrum toward a sale or another measurable result.

If I can go back in time and quote one of my favourite advertising icons, it was Leo Burnett who once said, “Plan for the sale when you plan the ad”. He was addressing a different age of advertising, but the words still apply. While he was certainly talking about a print or television ad, in today’s currency, the ‘ad’ might be a piece of content, an embedded product or any other experience.

The importance of building brand equity is consistent throughout a campaign’s lifespan, as it is also the true determinant of increased sales. Sales are really just facts and figures. Brand equity is something that grows over time and can lead to greater sales in the future.

Consider the case of Nihar Natural, which after 50 years of market leadership had become a commonplace product for women in the rural Bihar province. With little marketing investment, the brand was losing market share and the consumer had become indifferent to the product. Because the essence of Nihar is purity, the marketing campaign included community meetings and rallies in many of Bihar’s villages dedicated solely to the subject of purity, and featuring Nihar Coconut Oil. Thousands of people participated. The effort built equity for the brand and simultaneously drove sales, increasing Nihar’s market share by 4 per cent.

In 2008, the Singapore Tourism Board decided to reposition the way Singapore was perceived in India, and increase intent-to-travel by 10 per cent. Knowing that a vacation for most Indian families is very much focused on children, the Tourism Board partnered with POGO to take its ‘MAD’ (Music, Art & Dance) programme to Singapore for a summer. The ‘MAD in Singapore’ campaign featured an on-air and online contest, asking children in India to express what they loved about Singapore. The month-long contest gave five lucky children the chance to travel to Singapore and appear on the show. Post-campaign research by AC Nielsen showed that one in three families was encouraged by their child to take the family to Singapore. Of these families, nearly 75 per cent said they planned to travel to Singapore within two years, which translates to a 59.1 per cent increase in intent-to-travel.

I cite these examples to emphasise how successful marketing campaigns have evolved. Successful advertising is no longer about image-building ads, followed and supported by other below-the-line efforts that drive intent and purchase. Equity and sales are inextricably embedded in consumer engagement.

The question marketers should ask is not so much how to balance brand equity and sales, but how to intersect with consumers in a way that will resonate with them and add value to their lives. We can no longer separate brand experiences and messaging into that which builds affinity and that which drives sales, because it all fuels engagement. And if we listen closely to consumers, they will help us understand where to reach them, how to reach them, and what they want to hear from us when we do capture their attention.

(Jack Klues is Managing Partner, VivaKi. He oversees a variety of strategic assets spanning Digitas, Starcom MediaVest Group and ZenithOptimedia. Along with his duties at VivaKi, Klues is also member of Publicis Groupe Directoire, the elite governing body that guides Publicis Groupe S.A.)

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