BIG BET #1: BRAND
The final frontier of measurement, brand, will get conquered
19th-century Philadelphia retail scion John Wanamaker once said: “Half the money I spend on advertising is wasted; the trouble is I don't know which half.” We feel his pain. It must have been hard to determine ROI from newspaper ads, sandwich-men, and handbills.
A century after his death, things haven't really changed that much – which is befuddling, to say the least. Given that all marketing has gone digital and all digital is measurable – all marketing is performance. So why is measurement of that historically elusive holy grail of marketing, brand equity, still stuck in the horse-and-buggy days? Surveys and questionnaires, brand recall tests, brand lift studies, PR coverage, competitor benchmarking: it all seems so, well, analog. None of these metrics actually answer the question, “How does your brand actually affect your business?”
You can think of brand equity as a cumulative set of perceptions held by many individuals that incorporate not just the value proposition of your product, but the positive and negative beliefs about a brand as a whole. These perceptions can significantly influence consumer behavior and, through that behavior, revenue over time.
Why hasn’t this been solved? Well, quantifying the impact of brand equity is hard. Really hard. It’s no exaggeration to say it’s THE MOST challenging marketing concept to make quantitatively tractable. And as a bunch of quantitative wonks, tech wizards, marketing scientists, and creative people who care as much about performance as we do brand, we've spent a lot of time trying to figure it out.
“When it comes to measuring brand equity and quantifying its impact on performance, the goal is not to reinvent the wheel. Rather, it's about integrating various components into a novel framework. Our brand equity measurement framework is pushing out the frontier of the possible in quantifying brand drivers and business value."
Ravi Rajan
Director, Marketing Science & Econometrics, Tinuiti
The measurement challenges boil down to two issues. For one, brand equity is about perception, which does not leave digital traces in the way that actions do; outcomes are therefore not queryable the way one might add up the number of app installs. Second, inferential analysis is technically challenging. That’s a fancy way of saying longer-term brand equity does not lend itself as well to small-scale, prospectively designed experiments the way one-off, action-oriented campaigns do.
Now, this is where we expect to see some serious progress in 2024. It will soon be possible to get answers to the two burning and interrelated questions that old John W. was referring to: “What is the impact of paid media spend on brand equity? What is the impact of brand equity on revenue?”
Arguably, brand equity matters more than ever given the current challenges – economic uncertainty, ever more critical and cynical consumers looking for a reason to believe, privacy protections, walled gardens, and the quickening speed of the consumer journey. The final frontier of measurement is coming at just the right time.
OK, SO NOW WHAT?
- Identify the one source of truth or central authority in your organization who can confirm the accuracy of your daily revenue and spend by channel and platform. If your organization has multiple sources for this data, it’s time to appoint one czar to oversee and validate, as these will be the critical inputs for your brand equity model.
- Bring in your CFO now so she buys into the model before it launches. Once she sees quantifiable, credible evidence of the incremental impact of brand equity on ROAS, she’ll be much more likely to invest in the longer-term strategies you’ve been trying to sell in.
- Talk to us about how we can help you build a model to assess your brand equity.