The Market Power of the Brand

VOL. 0046 – FLORIDA, MONDAY, MAR 12, 2024

Juan F. Arjona Harry

President & CEO Strategee   

After several years of management and probably a lot of investment, the question that must be asked is: So what is the market power of our brand? How strong is our brand in an increasingly competitive market and besieged by competitors that erode the value?

The answer to this question, we all must do, is necessarily mathematical, because it's about value, it's investments made under the assumption that whoever runs the marketing, really knows what it is and has done well or did run well for years.

What is invested in the life of the marks is a fortune when it added to present values ​​in years, hence the answer should go beyond a simple top of mind, a coveted top of heart, and must go beyond the scheme brand symmetrical funnel, reaching to be purchased and remembered but… What happens with the value?

This is where we then measure what is called the market power of the brand, that is, its ability to absorb the impact of price swings, aggressive competitors seeking market share and impacts of smart promotions implemented by competitors. This is where despite of the countless innovations that reaches the market year after year; our brand is not switched, keeping the total loyalty of our consumers. Remember that when we speak of loyalty, we say that our consumers not only prefer our brand, they defend it, recommend it and pay a little more for it, making it their own, entering it to their constellation of consumption as part of themselves and their own daily life.

Is here where with the measures of loyalty at the top of the scale, our consumer supports and buys our brand with a higher price even under the pressure of high competence in the category, despite the exercise of tradeoff is in principle favorable to other brands.

This is the true market power of brand, where it supports the stressful exercise of real market, to compete with its own heritage built on years compared to attractive price, discount or promotional that creates consumer concern generated by optimizing its purchase decision.

Measuring Market Power of the Brand, is vital in an environment in which global pressure for price deflation, hyper-competitive markets, presence of more and more brands and products (in good manufacturing condition) and markets threatening to erode loyalties of established brands in each category.

The market power of the brand allows a brand to have low price elasticity of demand to price increases, but a high price elasticity of demand given to temporary promotions or discounts.

Measuring Market Power Brand is vital in calculating the ROI and cost-efficient use of marketing resources.