DEFINITION of 'Brand Potential Index (BPI)'
The correlation between a given brand's market development index and its brand development index for a specific market or geographic area. The Brand Potential Index (BPI) compares actual and potential customers within a market area to the percentage of consumers within a geographic area in the United States who buy a product compared to the percentage of all consumers in the entire United States who buy the same product. It is always calculated for a limited geographic region.
BREAKING DOWN 'Brand Potential Index (BPI)'
The Brand Potential Index is a tool that can be used to forecast future sales, and to assist in the budgeting process for advertising allocations. Use of the brand potential index can be part of a firm's arsenal in finding a competitive advantage. The index, which can help identify key drivers that have the greatest influence on brand strength, is based on the rational, cognitive, emotional and behavioral characteristics of perception. Companies ranging from giants like the major airlines to small and mid-size businesses use the BPI as part of their brand management and development strategies.