According to Bilson Simamora Marketing and Research Center (BSMRC), ‘Brand Development Index is the comparison of a company’s sales per potential market in a certain region, with the sales per potential market as a whole.’


Based on personal experience, the advantages of measuring the Brand Development Index (BDI) are as follows:

  • In a condition where the potential market is unknown, BDI has the capability to use the size of the population in a certain location as a substitute for potential market information.
  • Acting as a basis for decision making, BDI has the ability to determine market performance using a geographical method. When a market in a certain region has a low BDI score, management can use a marketing strategy and determine whether it is necessary to increase the promotional budget or even pivot the market.

How to measure Brand Development Index (BDI):

Case example

  1. Known information:
  • Sales of Producer A’s products in West Java 2020 totaled 862,653 units
  • The population of West Java in 2020 according to BPS data was 49,935,858 people
  • Sales of producer A’s products in Indonesia 2020 totaled 4,509,653 units
  • The population of Indonesia in 2020 according to BPS data was 269,603,400 people

2. Measuring BDI:

3. Interpretation:

  • The BDI of sales in West Java is 1.03, which means that Producer A’s sales performance in West Java is 3% higher than sales nationally.
  • The West Java regional promotional budget for 2021 can refer to the 2020 budget because the sales performance in West Java is 3% better than national sales. Budget may be increased if deemed necessary, with certain assumptions in mind.
  • The evaluation of West Java’s BDI score can be compared to other regions, to find out how West Java ranks on a national scale.

References:

https://www.bilsonsimamora.com/brand-development-index/
https://sendpulse.com/support/glossary/brand-development-index

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