Relating consumer-based sources of brand equity to market outcomes

Among scholars and practitioners, there is some agreement on the concept of brand equity. Yet measuring this construct is less clear. This project considers how various measures of brand value relate to one another. Study 1 compares market-based outcomes (i.e., Financial World ratings, and annual sales) with consumer-based sources of brand value (i.e., familiarity, usage, and evaluation). Study 2 uses affinity analysis to examine how consumers' brand associations differentiate market leaders from followers. Study 1 found a weak relationship between measures, whereas the rich results of Study 2 are encouraging for both scholars and managers. Researchers have studied and measured "brand equity" from both the organizational (e.g., Simon and Sullivan 1993)and customer (e.g., Keller 1993; Krishnan 1996) perspectives. Recently, Keller (1998) used a customer-based definition of brand equity to distinguish sources of brand equity held in consumer knowledge structures (i.e., customer-based brand equity), from marketplace outcomes of brand equity (i.e., market-based brand equity).(2) The relationship, however, between customer-based and market-based measures of brand equity remains unclear(although Krishnan [1996] has studied the question). This paper presents two empirical studies that explore this issue. Study 1 compares consumer-based measures of brand awareness-including familiarity, favorability, and direct experience-to market outcomes of brand value (annual sales, and the Financial World's measure of brand value). Study 2 then introduces a new method called affinity analysis to examine how brand image-strength, uniqueness, and favorability of brand associations (Keller 1993)-may differentiate between two market-leading brands.