Brand Switch Analyst

Brand Switch Analyst in a Nutshell

Brand Switch Analyst makes the analysis of brand switch behavior, which is the tendency of consumers to change preference between comparable products. This is vital information for fostering strategic thinking in managers aware of the importance of customer retention.

It is very easy to use Brand Switch Analyst. The only data needed is the sales of several competitors for two or more time periods. The output consists of figures and charts that, for each product, show the amount of sales or market share won from or lost to competitors.

Switch rates can highlight competitive weaknesses in the brand preference dynamics of competing products, which in turn makes it possible to allocate marketing resources in a more targeted way and, hopefully, to increase success.

Finally, Brand Switch Analyst can also be used as a forecasting tool for projecting market shares and trends up to their steady point, that is the point in time when no more changes occur.

Why should I use Brand Switch Analyst?

Professor Kotler said:

Marketing executives must watch their market shares just as much as their profits. Present customers can never be taken for granted.

Although written in 1963, this statement is still of great actuality, and in part it has also inspired the development of Brand Switch Analyst. Market share is seen as a major means of determining competitive position and the following three factors determine its structure:

• The management's ability to retain present customers, also called Retention Rate or Brand Loyalty Index
• The management's ability to draw customers away from competitors, that is the Switching-in Rate
• The tendency for a brand to lose customers, that is the Switching-out Rate

Brand Switch Analyst makes accurate estimates of switch and retention rates, which otherwise would be estimated using expensive marketing research surveys. It is a tool that can be used for challenging business axioms and to reinvigorate the strategic discussion within teams. It allows looking at data from a different perspective when segmenting customer preferences and competing products. It is also useful for developing functional know-how, for instance, for marketing analysts interested in quantitative techniques.

Important Note:
Brand Switch Analyst uses Solver for solving the quadratic programming and estimating switch rates. Therefore, Solver must be installed and started at least once (before you start Brand Switch Analyst call from the Excel menu Tools