Chapter 19
Brand Scorecards
Measurement Need
To identify and assess the intangible factors within brand equity.
Solutioni
Brand assets and liabilities are scored compared to the average brand in that market. Roger J. Best suggests thinking of brand equity as the analog to the owner’s equity in the balance sheet. The difference is that brand equity is determined by subtracting brand liabilities from brand assets, and a scorecard for each is used.
Brand Assets
Brands are comprised of five primary assets:
- Brand awareness: how aware are consumers of your organization and/or its offerings?
- Market leadership: what is your market share?
- Reputation for quality: are you perceived as offering superior quality?
- Brand relevance: are your offerings relevant to the customers you target?
- Brand loyalty: do customers remain loyal to your offering over time?
A marketer would compare their individual brand to the average brands in the market. Each of the five categories of brand assets are scored on a 1–20 point scale (20 being most valuable), with a maximum score of 100 for all five assets combined.
Table 19.1: Brand Asset Scorecard
Brand Liabilities
There are five brand liabilities:
- Customer dissatisfaction: how high are customer complaint levels?
- Environmental problems:* are your environmental practices poor?
- Product or service failures: is product quality low?
- Lawsuits and boycotts: is your company facing legal problems?
- Questionable business practices: are there ethical lapses?
*Note: Corporate social responsibility (CSR) is increasingly important as a determinant of reputation. Does a company ignore the communities in which it operates? Does the company consider investment in sustainable business practices a poor use of invested capital? If so, then a low CSR score would likely follow.
Similar to brand assets, marketers would want to score their companies and/or products on the chart below (see Table 19.2).
Table 19.2: Brand Liabilities Scorecard
The final step is to subtract brand liabilities from brand assets. The difference provides a simplified view of brand equity, albeit a subjective one as well. Figure 19.1 reinforces the brand balance sheet metaphor in a diagram.
Impact
Marketers can use this brand scorecard for a quick assessment of their brand equity relative to their average competitor and derive a score that indicates the relative strength of the brand. Best’s framework helps address the intangibles at a general level and serves as a useful starting point for further analysis, but the question of a clear definition of each intangible’s source of equity remains. Marketers should dig deeper to decode the five brand assets and five brand liabilities to determine where their brand is vulnerable, and where their strengths can be further leveraged.
The data is gathered from market research reports about the brand’s reputation in the market, surveys and interviews with customers and other key stakeholders, and a transparent accounting of the brand’s self-view.
iR. J. Best, Market-Based Management: Strategies for Growing Customer Value and Profitability (Upper Saddle River, NJ: Pearson Education, Inc., 1997, 2000, 2004, 2005), 220–223. Cited in John Davis, Measuring Marketing: 103 Key Metrics Every Marketer Needs (Singapore: John Wiley & Sons (Asia) Pte. Ltd., 2007), 236–240.