Brand Efficiency and Brand Relevance - Introducing and Linking Both Concepts
AMA Winter Educators' Conference Proceedings, Austin, Texas, 2008
Posted: 20 Aug 2007
Brand managers are under increased pressure to illustrate the performance of their multimillion dollar expenditures. As a first contribution we provide the concept of brand efficiency as a methodologically and theoretically sound measure for the performance of the brand management process. As a second contribution we develop a measure for the industry specific brand relevance, i.e. the influence of the decision criterion "brand" on buying decisions in an industry. Third we link these concepts and examine if brand management efficiency in an industry is influenced by brand relevance. Our results show that firms in different industries are equally successful in transforming brand investments into consumer based brand outputs. In contrast, firms differ significantly in capitalizing them in terms of financial outcomes according to their industry specific level of brand relevance. Thus, brand relevance should be used as a key metric for determining and allocating brand investments.
Keywords: brand management, brand relevance, brand equity, marketing-finance interface, brand efficiency, data envelopment analysis
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