ABOUT THE SCORE
The Brand Strength Score looks at the consumer purchase power makeup of a category, brand, or a retailer in a single score, which allows for easy comparisons across time or against benchmarks. The score ranges from 10 to 100, with 100 being the “strongest” possible reading. A reading of 100 indicates 100% of a brand’s shopper base falls in the highest purchase power decile, while a reading of 55 indicates the shopper base is evenly distributed among the ten purchase power deciles.
DEFINING THE BRAND STRENGTH SCORE
Tracking Brand Strength across time can help understand premium positioning of a brand in context to the category and competitors. An example is Beyond Meat, a Fresh Meat Alternative brand that has historically captured higher purchase power households with its premium offering. However, as the brand continues to grow household penetration and increase promotional ad blocks, the buyer makeup has diversified to include lower purchase power households, aligning more closely with the Fresh Meat Alternative category overall.
BEYOND MEAT EXAMPLE
Understanding brand strength.
Evaluate premium positioning.
BRAND STRENGTH SCORE IN ACTION
Takeaway: As a brand becomes more mainstream with a less financially secure shopper base, they will need to consider whether the positioning they currently offer is enough to continue demanding a higher price point, or whether they should expand into more affordable variants.
In stratified categories where premium and value offerings are equally important, understanding the brand strength of your competitive set can help identify where consumers may shift when faced with financial constraints. Within the Shaving category, we see Harry’s attracting shoppers with the highest purchase power, and Private Label the least. However, Dollar Shave Club and Private Label have seen the most significant upwards trend in their scores over the past two years, signifying they are attracting more high purchase power shoppers.
Takeaway: Facing inflation, brands and retailers have multiple options for addressing consumers with tighter budgets. They can establish more premium looks at cheaper offerings to retain high income households, or embrace a value positioning to cater to low income households and grow with them in the future.
SHAVING CATEGORY EXAMPLE
Identify potential trade downs.
Retailers can also employ a similar strategy. Take grocery shoppers at the following retailers: Whole Foods has the strongest shopper base, but has been trending down over the past two years. Amazon has also seen a significant shift in their shopper base, becoming increasingly popular with lower purchase power shoppers over the past two years, while Dollar General and Dollar tree have seen the opposite trend.
Examining a brand across the multiple categories in which it operates can help assist in better-positioning each offshoot of the brand to align more closely with consumer needs. Take for example Scotts Miracle-Gro. The brand plays across more than eight categories within the Home & Garden department, spanning from fertilizer to pest control. Even with similar branding, the shopper they bring varies widely across categories, meaning distinct positioning needs and brand defense strategies.
Takeaway: For manufacturers managing a brand across several categories, understanding the nuances of their shopper between those categories will help prepare the brand for decisions in price increases and promotional strategy.
SCOTTS MIRACLE-GRO EXAMPLE
Inform portfolio management.
DEFINING CONSUMER PURCHASE POWER
Purchase power is a proprietary Numerator calculation that segments consumers into deciles based on multiple factors including their annual income, household size, and regional cost of living. Defining a consumer’s financial constraints exclusively based on household income can be too simplistic; for example, low income households skew rural and single-person. Purchase Power controls for household size and cost of living to portray a more accurate picture of a consumer’s buying power.