A brand index is something which tells you how the biggest brands in a certain market (such as electronic goods, wellbeing and fitness brands, snacks and fast food brands, etc.) shape up amongst one another. If you’re a market leader this is vital information to know. As it specifically shows how customers are responding to their brands, and can show the specific areas they’re doing well and not so well in. However, if you’re a smaller company, it can be hard to see how a brand index within your market is really relevant to you. In this article, we’ll look at why this isn’t the case. Showing areas that businesses of any size should look out for when new brand indexes come out.

Firstly, it’s important to know what a brand index is comprised of. The answer depends on what brand index you’re looking at, as different brand indexes will use different metrics. In this article, we’ll consider three metrics used for a lot of brand indexes: unprompted brand recall (naming brands within a certain category), net promoter score (how likely consumers are to recommend a brand), and purchase intent (how likely consumers are going to buy a brand). Within each brand index, it should be possible to see the specific score for each of these metrics too. As a smaller business, not much attention should be paid to unprompted brand recall, as this is what measures a brand’s general presence. If you’re not known on a national or international level, then there’s not much point concerning yourself over not appearing in these results and worrying about which brands did.

The other two metrics however, can help medium-sized business owners see how things are changing within their market. For example, if purchase intent drops throughout the whole of the brand index, this can show that a market is generally under threat due to economic changes on a larger scale. It might be the case that it’s a luxury goods market, and due to slow economic growth, consumers have less disposable income to spend. If this was paired with net promoter score not dropping, then this shows that the fault doesn’t lie with the brand/product itself.

Finally, if a brand shoots through the rankings, it shows that they’re doing something right. So it can be worth taking the time to properly research what they’re doing differently to their competitors. Then perhaps seeing if it’s possible to replicate this.

 

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