Measuring Customer Based Brand Equity Using Hierarchical Bayes Methodology

Abstract

In this paper, we propose a method to measure brand equity in a product category at the individual level that allows managers to parcel out brand equity into its respective components and estimate the relative importance of these components. The monetary equivalent value for each of the sub-components of brand equity is calculated. Two new measures for evaluating the long-term health of a brand are also proposed. A nested design based on conjoint methodology, coupled with a hierarchical linear Bayes model, is used to estimate brand equity. The methodology is applied to the Television category and its applicability to managerial decision-making is shown.