Building brand value helps you develop deeper connections with your consumers. It’s not just about what you offer, but also how your brand is perceived. This perception is crucial for long-term success.
Strong brand value leads to loyal customers, improved reputation, brand differentiation and the ability to charge more for products.
But how do you know which factors are driving your brand value? Key driver analysis (KDA) is a pivotal tool in this context, acting as a commercial compass to navigate the complex network of factors that truly matter to your customers.
Read on to explore how to leverage key driver analysis for data-driven decisions that enhance brand performance and drive long-term growth.
Why use key driver analysis?
To drive brand value and ultimately win more market share, your strategy must be based on understanding what your consumers value. This is particularly relevant when developing strategies for brand positioning, communications, pricing and innovation; both in the long and short term. The insights provided by key driver analysis can help your brand increase customer satisfaction, competitive advantage, and sustainable long-term growth, making it an invaluable tool to enhance market position and achieve lasting success.
Uncover complex relationships
Key driver analysis employs robust statistical techniques to uncover complex relationships between the factors that drive your brand’s value. In the context of brand management, KDA provides a framework to assess how various elements of your brand contribute to its overall value. This approach is particularly valuable because it uncovers a series of interrelated dependencies that influence consumer decision making.
For example, a consumer’s purchase intent could be influenced (to varying degrees) by factors such as brand momentum, sustainability, brand confidence and brand premiumness. Knowing which factors, and their level of influence, helps you to focus on what really counts.
Methods available to model complex relationships
Methodologies such as Structural Equation Models (SEM) and Bayesian Belief Networks (BBN) model the complex relationships between variables to test plausible and hypothesized reasons for observed data patterns.
In SEMs, observed and latent variables are interconnected by pathways that quantify the strength of their relationships. This allows us to dissect intricate consumer behaviors and pinpoint the key drivers of your success.
BBNs use probabilistic graphical models to represent a set of variables and their conditional dependencies via a directed acyclic graph. This method facilitates data-driven decision-making by quantifying the likelihood of various outcomes based on specific factors.
Both methodologies empower your brand to move beyond surface-level insights to uncover deep, actionable intelligence that fuels strategic growth and enhances competitive advantage. Understanding these key drivers is not just a technical exercise; it is fundamental to crafting more effective marketing strategies that resonate with your target audiences.
Direct and indirect drivers
One of the standout features of using SEM or BBN is their ability to isolate and measure both direct and indirect drivers that enhance brand value. These methods help in quantifying the role and impact of these factors, enabling your brand to understand their effect on consumer behavior.
Emotional and rational drivers
Brands that successfully form emotional connections with their consumers drive long-term loyalty. Emotional drivers might include exceptional customer service or a nostalgic connection, while rational drivers may involve practical aspects like features, price or convenience.
The ability to dissect the intricate interplay between emotional and rational drivers offers an important advantage to brands. Through a comprehensive understanding of what really drives consumer decision behavior, it’s possible to create a holistic brand experience that resonates with and engages consumers on multiple levels, fostering deeper connections and long-term loyalty.
Focus on what matters to your consumers
More innovative and impactful marketing strategies can be achieved by understanding the different pathways that influence brand value. For example, a brand discovering that emotional drivers such as customer service or heritage are more important than rational drivers like product or service features, can target its message accordingly and enhance both customer satisfaction and competitive advantage.
Healthcare use case: The value of key driver analysis in recommendations
In the hearing products market, understanding what drives brand recommendation is crucial. For one provider, the challenge was to identify the most impactful factor influencing recommendations from healthcare providers.
A key driver analysis conducted by SKIM provided the insight needed: Interestingly, exceptional customer care, rather than product and solution innovation, was the stronger driver of brand recommendation. Armed with this revelation, the marketing team, who had long suspected that focusing on the emotional aspects of customer engagement would be more effective, shifted their strategy.
By prioritizing resources and initiatives to enhance customer interactions, the brand sought to significantly increase recommendations received from healthcare providers. This case illustrates the vital role of key driver analysis in identifying and leveraging the most influential factors to achieve brand success.
Food brand use case: The importance of key driver analysis in product success
In the rapidly growing plant-based category, brands face the challenge of standing out in a competitive market. For one brand, the key question was how to position their products to best meet consumer expectations.
A key driver analysis conducted by SKIM provided the answer: The product “tasting like meat” emerged as the most crucial factor driving consumer preference, followed by nutritional content and ease of use.
These insights gave the brand owner a clear strategic direction for brand communications and also enabled them to capitalize on the untapped potential in nutrition and ease of use. This demonstrates the significant value of key driver analysis in new and growing markets in shaping product success.
Leverage KDA for long-term brand success
By using KDA, you’ll gain a deeper understanding of what drives your brand’s value. Strategies created using key driver analysis are difficult for your competitors to replicate, securing your brand a unique and more sustainable position in the market. By deeply understanding and leveraging the drivers of brand value, your brand can gain a strong competitive edge.
Want to learn more about how KDA can help your brand? Book a consultation with a SKIM expert today.