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Brand Potential Index (BPI)

Brand Potential Index (BPI)
BusinessMarketing Essentials

What Is the Brand Potential Index (BPI)?

The brand possible index (BPI) is a measure of the correlation between a brand's development index (BDI) and its market development index (MDI) for a specific market or area.

The Brand Potential Index (BPI) takes the number of genuine and expected customers inside a market area and looks at it to the percentage of [consumers](/shopper spending) inside a geographic area an in a country product. Then the BPI looks at that number to the percentage of all consumers in the whole country who buy a similar product.

The BPI is constantly calculated for a limited geographic region to provide its users with a better thought of how specific areas factors into its sales and marketing planning and forecasts.

Figuring out the Brand Potential Index

The brand potential index is a device that can be utilized to forecast future sales and aid the budgeting system for [advertising allocations](/advertising-financial plan).

Utilizing the brand potential index can be part of a company's munititions stockpile to find a competitive advantage. The index, which can assist with distinguishing key drivers that have the best influence on brand strength, depends on the rational, cognitive, emotional, and behavioral attributes of insight.

Companies going from monsters like the major aircrafts to small and moderate sized businesses utilize the BPI as part of their brand management and development strategies.

Brand Potential Index Calculation

To figure a brand likely index, the brand's market development index and the brand development index must be used.

  • A market development index (MDI) is utilized in business development to figure out when maximum market penetration will occur. It is communicated as a ratio between the genuine number of consumers versus likely consumers in a specific market.
  • The brand development index (BDI) is defined as a ratio that is an examination of the percentage of sales earned in a specific area or region to the percentage of the total population of that area or region. Such data can assist companies with fitting their sales, marketing, and advertising efforts since it gives knowledge into where the greater part of their customers reside.

In particular, the BPI is figured as the ratio of the BDI partitioned by the MDI.

Brand Potential Index Example

Say that a brand gets 5% of its sales in an area that is likewise home to 15% of the country's population; then, at that point, that area's brand development index is the product of 5 x 100/15 or 33.33%.

Assuming the total number of customers in that area is 10,000 while the number of potential customers is 100,000, then, at that point, the market development index will be the consequence of the ratio: 10,000/100,000 or 0.1.

The brand potential index would be the relationship between those two factors, or 0.33/0.1 = 3.3.

Features

  • The BPI utilizes the brand development index and the market development index, every one of which is utilized broadly in marketing.
  • The BPI is utilized to measure the size of the market share that might be available to them and to illuminate marketing and advertising strategy.
  • The brand likely index (BPI) measures the number of potential customers a brand that might arrive at inside a certain market or region.