“Before you can have a share of market, you must have a share of mind.”
Linda Wolf, former chairman and CEO of Leo Burnett Worldwide[i]
Companies spend hundreds of billions of dollars each year to capture share of customers’ minds. In fact, P&G alone spent $4.3 billion in 2015 to attract customers to its brands. Of course, the reason for this massive spending is that getting customers to seriously consider using a brand is no easy task. It requires that your brand occupy a prominent place in consumers’ minds.
For most companies, the primary path to improving share of mind is by increasing share of voice. In other words, companies spend heavily to increase the percentage of all advertising content about the brand relative to competitors. Clearly, increasing the impressions a brand has on customers is important. But the harsh reality is that we see about 1200 marketing messages every day. And because they are everywhere they are in reality nowhere—we have learned to tune them out.
For customers to change their regular buying behaviors, they first must believe that they should. This means that they must actually think about it. Given the numerous purchases that each of us makes every week, it is completely unrealistic to expect this for most of the things we buy. We would never make it out of the grocery store if we seriously considered the alternatives for everything we put in our shopping carts.
As purchase decisions become routine for most brands, appealing to buyers requires a winning strategy. Inside the walls of every company are groups of people trying to figure out how to attract new customers, keep their current customers and also get them to buy more. The anemic growth rates of most companies, however, demonstrate just how hard that is to do.
“Brand value…What in God’s name is this anyway? It’s not as if our shareholders care.”
CEO of a Spanish telecommunications firm[ii]
One of the first goals of any marketer is to ensure that when people think of your product or service, your brand comes to mind. But being one of any brand seen, read, or heard about in the category is not the ultimate goal. Every manager wants their brand to be thought of first, and thought of positively relative to competitive alternatives. Most importantly, every manager wants this to translate into market performance.
This is where traditional approaches fall short. Frequently traditional brand tracking studies report strong performance, but lack a corresponding increase in sales. This disconnect between the metrics tracked by marketers and financial or market outcome is a serious source of frustration for many CEOs with their firms’ marketing efforts (and with marketing in general).
While it is easy to blame marketers for being out of touch with the objectives of CEOs, the reality is that it is difficult to imagine most marketers as not caring about market performance. Rather, the problem is more pernicious. The metrics marketers have been taught to monitor frequently have no direct relationship to buyer behavior.
The good news is that the problem isn’t that the metrics being tracked are “wrong”. Rather, it is that the way these metrics are measured and analyzed fails to account for how customers actually make buying decisions in competitive markets. In particular, in most categories, customers shift their spending between multiple brands—in other words, they are loyal to a set of brands, not a brand. Moreover, even when customers would prefer to use a brand, there are a host of market factors that make doing so far less likely.
As a result, traditional measures of brand equity and brand value, which for some of brands are estimated to be worth in the tens—even hundreds—of billions of dollars, appear more akin to Monopoly game money than a measure of true gauge of brand value to many (perhaps most) CEOs. Without question, it’s not a value that easily translates into a company’s reported profits.
A Better Way
To connect customers’ perceptions of brands to the market performance of these brands, two fundamental issues must be addressed:
- How do we translate the power of the brand in customers’ mind (i.e. mind share) to power in the market (i.e. market share)?
- How do we account for the structure of markets that distort demand (i.e. market barriers)?
Fortunately, new research has uncovered powerful ways to answer these questions.
Mindshare is much more than share of voice. Research has found that the best way to gauge share of mind is to gauge how customers and potential customers perceive your brand relative to competitors.[iii] Specifically, how does your brand rank vis-à-vis competing brands that customers consider using? We’ve always known that it’s more important to be number one, but we can now quantify what this really means for customers’ buying decisions. More importantly, research consistently shows that understanding the rank that your brand holds in customers’ minds strongly links to market share.[iv]
Even when my brand is number one in customers’ minds, other factors can influence their purchase decisions. Numerous market forces impact our ability to buy a preferred brand. Therefore, to have a holistic understanding of brand performance, these market barriers must be identified and accounted for so that managers can translate preference into purchase.
MaxMindShare™ allows companies to understand the link between mindshare and market penetration through a metric derived from the impression customers have about your brand and competitor brands – the Mindshare Allocation Rule Score (MARS)™. By identifying specific barriers to purchase behavior, we can predict market share and market penetration in your category. Because it accounts for how your brand ranks relative to a competitive set, MARS™ is a better predictor of share than a single uni-dimensional brand equity metric.
Once you have decoded how your customers make buying decisions in the context of your competition, and the market barriers that influence their actions, you can identify what really drives share. This requires understanding what really differentiates your brand from the competition—not simply what’s important. Lots of things are important, but the reality is that only a few attributes really differentiate brands in the minds of buyers. MaxMindShare™ uses a proprietary “best brand” scaling method to assess brand image on functional and emotional attributes that drive mindshare. With this input, we derive a list of core equity drivers and quantify the upside gain from improving your ranking on each.
Of course, marketers need to go beyond identifying the key mindshare drivers. They want to understand what these drivers mean to buyers and how to operationalize them in messaging in order to improve mindshare. MaxMindShare™ answers this question by creating means-end ladders that link brand attributes to purchase benefits (functional consequences), emotional benefits (psycho-social consequences), and values that govern our behaviors. This learning is used to develop Consumer Decision Maps that guide you in formulating value propositions and crafting powerful messaging that will gain mindshare.
MaxMindShare™ is truly unique because it is anchored in science, provides metrics that predict market share, identifies exactly where you need to focus to increase mindshare, and guides you in formulating a value proposition rooted in buyer emotions and values. Compared to competing approaches to assess brands, Rockbridge’s cutting-edge approach delivers results that management can understand, drive strategy and are truly actionable.
A leading credit union in Texas wanted to relaunch its brand with a compelling positioning that distinguished it from competitors in its footprint. The institution wanted to identify the value proposition and emotional drivers from the perspective of existing customers and prospects.
Rockbridge implemented an online survey among 1,000 members of the credit union and 300 customers with a banking relationship with competitors in the market footprint.
Rockbridge began the process by conducting stakeholder interviews with management and staff at the credit union. In the survey, a list of rational and emotional attributes were presented to each respondent who then rated financial institution performance using a proprietary “Best” scaling.
A MARS (Mindshare Allocation Rule System) score was computed based on the overall impression each respondent had of the credit union and other financial institutions in the market. The MARS proved to be a strong predictor of market and penetration.
Rockbridge modelled the key drivers of mindshare, identified barriers that limited the institution’s ability to achieve the full potential of its mindshare, and developed means-end maps that framed choices in terms of deeper emotions and values.
The credit union was able to determine the best strategy and messaging to relaunch its brand in order to increase market penetration and likeability among the credit union’s members and banking customers in the market footprint.
[i] Richardson, Kari, and Matt Golosinski (2004), “The Business of Brand,” Kellogg School of Management: News and Events. (April 1), available at http://www.kellogg.northwestern.edu/news_articles/2004/brandbusiness.aspx (Accessed September 14, 2016).
[ii] Keiningham, Timothy, Lerzan Aksoy, and Luke Williams, with Alexander Buoye (2015), The Wallet Allocation Rule: Winning the Battle for Share, Hoboken, NJ: John Wiley and Sons, p. 1.
[iii] Keiningham, Timothy Lee, Bruce Cooil, Edward C. Malthouse, Bart Lariviere, Alexander Buoye, Lerzan Aksoy, and Arne De Keyser (2015), “Perceptions are relative: an examination of the relationship between relative satisfaction metrics and share of wallet,” Journal of Service Management. 26 (1), 2-43.
[iv] Buoye, Alexander, Yuliya Komarova Loureiro, Sertan Kabadayi, Mohammad G. Nejad, Timothy L. Keiningham, Lerzan Aksoy, and Jason Allsopp (2016), “Is share of wallet exclusively about making customers happy or having more customers? Exploring the relationship between satisfaction and double jeopardy.” Journal of Service Management. 27 (4), 434-459.
Written by: Charles Colby, Chief Methodologist, Principal and Founder; Tim Keiningham, Chief Strategy and Client Officer and Alonso Espino, Senior Research Analyst