Measuring Brand Impact

It’s hardly a revelation, in 2021, to talk about data in our marketing world. Marketers, to varying degrees, understand the value of data in measuring the performance of their marketing efforts.

CFOs and CMOs generally speak the same language when it comes to the financial implications, and performance metrics in marketing follow those financial implications. However, the language spoken between those key executives may differ when the question arises about the value of “brand.”

In order to address this question, it is important to agree on what question is being asked. In our experience, the true question being asked is either how much is the brand worth, or how much does brand marketing contribute to overall marketing performance? Clearly, the approach to answering the question depends on which of these two questions is actually being asked.

There are a lot of approaches to addressing brand value. Many of these approaches use hard, objective data such as financial, while other approaches may lean more toward customer-reported data such as Net Promoter Score or tracking studies. Even the approaches that seek to blend objective and research-based data may utilize different tools such as quantitative algorithmic tools or more heuristic tools. FCB Health believes that, in choosing an approach to addressing brand value, companies should anchor as firmly as possible to their brand objectives and values. Then, we recommend that consistency in the tracking and valuation be paramount. Obviously, there are a lot of choices for partners to assist in these efforts.

If FCB Health were going to assist, we would recommend starting with our proprietary Brand Bedrock process to systematically identify the purpose and values of the brand. Then, we would tailor the measurement process and metrics to both gain a benchmark on where the brand currently stands on these metrics and measure the impact on these metrics on ongoing marketing efforts. Information regarding Brand Bedrock can be made available to you if you want to learn more.

This brings us to the second true question, namely, how much does brand marketing contribute to the overall marketing performance? There are disciplined quantitative approaches, that when used periodically, are especially effective at measuring just that. FCB Health’s recommended approach is to use marketing mix modeling (our version is called MixRx), with a combination of econometric and media data in a time series model.

This model examines the entire marketing tactical array and relevant econometrics to measure the contributions to revenue of each factor in the model. Always present, if statistically significant, is the Natural Market Rate (NMR), also often called Business as Usual (BAU). This factor may be attributed to the “presence” of the brand. If brand marketing is part of the marketing mix, then that factor is also specifically examined. The elasticities of the various factors in the model may be converted to an “ROI” (Return on Investment), or other value metric. See chart below:

Stimulated Sales By Medium By Week

Decisions regarding which of these two approaches to be used do not have to be mutually exclusive. To the contrary, both techniques provide valuable insights, as well as a means of monitoring how well a company is achieving its objectives. Companies often use marketing mix modeling and tracking studies routinely, and so it may merely be a matter of integrating brand purpose and values into processes already being executed. FCB Health is happy to partner with our clients in such endeavors, and we are well positioned to assist in developing the appropriate decision support mechanisms.

Please contact your account leads or ross.quinn@fcb.com if you have any questions or would like to discuss any of the above.