Saturday, 30 July 2016

Peru Scrambles to Drive Out Illegal Gold Mining and Save Precious Land

ON THE BORDER OF THE TAMBOPATA RESERVE, Peru — The raid began at dawn. In four small wooden boats, the forest rangers and Peruvian marines, checking and rechecking their automatic weapons, headed silently downriver toward the illegal gold miners.
They didn’t have to go far. Around the first bend was a ramshackle mining settlement, tarps stretched over tree poles. Soon, the marines were firing into the air, the miners and their families were on the run, and the rangers were moving in with machetes.


They speared bags of rice and plastic barrels of drinking water, kicked aside toys and smashed tools before setting everything on fire. High above the Amazon rainforest, home to trees that are more than 1,000 years old, heavy plumes of black smoke spiraled toward the clouds.


Trying to protect one of the most biologically diverse places on earth from an army of illegal miners that has carved a toxic path through the rain forest, the Peruvian government is setting up outposts and stepping up raids along the Malinowski River in the Tambopata Nature Reserve.


But some experts wonder whether it is far too little too late.


To get here, a remote front line in Latin America’s battle against illegal mining, I hiked nine and a half hours through the jungle, at times in water up to my armpits. But any sense of being in a pristine wilderness was lost at the river’s edge. Already, the miners had done so much damage that the water ran the color of milky coffee. The landscape was worthy of a “Mad Max” movie. Huge sandy craters, mounds of pebbles and poisoned waterways were everywhere. Garbage — rags, plastic bags, plastic foam food containers — clung to the freshly cut tree branches piled up in the river’s nooks and crannies.





With the price of gold high for years, illegal mining has blossomed in many parts of Latin America, not just in Peru. But in this country, one of the world’s major gold producers, the problem has gotten particularly bad.


The amount of gold collected by unlicensed miners is far larger than elsewhere in Latin America. And it is ballooning so quickly that environmentalists fear that even a remote reserve like this one — home to thousands of species of plants and animals, some perhaps not even identified by humans — has little chance of survival.


For all the environmental damage done by corporate mining, illegal miners are far more destructive, experts say. While mining companies tend to concentrate on areas with rich underground veins of gold, illegal miners move swiftly across vast amounts of territory. They cut down broad swaths of jungle, sifting through perhaps 200 tons of topsoil to find enough flecks of gold for a single wedding ring.


Without help, some experts say, the areas they leave behind — robbed of all topsoil and loaded with mercury — could take 500 years to recover.




The miners use so much mercury to process the gold that the government declared a health emergency in much of the Madre de Dios region in May. Tests in 97 villages found that more than 40 percent of the people had absorbed dangerous levels of the heavy metal. Mercury poisoning affects people in many ways, from chronic headaches to kidney damage, but it is most harmful to children, who are likely to suffer permanent brain damage.


“The next generations will pay for what we are doing now,” said Manuel Pulgar-Vidal, who heads the Peruvian Ministry of the Environment.


Statistics undercount the amount of illegal mining. But VĂ­ctor Torres Cuzcano, an economist with the Universidad Nacional Mayor de San Marcos, calculated that unregistered and informal mining increased by 540 percent between 2006 and 2015, while production from legal mining, which brings in tax revenue, fell by 28.5 percent.


“I fear that illegal mining is crowding out the legal activities,” said Guillermo Arbe Carbonel, an economist with Scotiabank. “You see social protests against the legal mining all the time. But the illegal is growing, and it is the worst kind of mining when it comes to the environment.”


Deforestation from gold mining accelerated from 5,350 acres per year before 2008 to 15,180 acres each year after the 2008 global financial crisis that rocketed gold prices.



Less than a year ago, the Tambopata reserve, a roadless area about the size of Rhode Island, part forest and part savanna, was untouched. Now satellite photographs show telltale patches of wasteland in the reserve, and so much mining that the river on its edge — the Malinowski, named after a Polish explorer — has been pushed off its course, made wider and more shallow. In areas where the miners work, the rangers say, the water is so polluted that the fish are all gone.


Some advocates say the reserve is all but lost. Early indications suggest that it is rich with gold, especially compared with other parts of this remote state, including the area officially reserved for artisanal mining and the “buffer zone” bordering the Tambopata reserve.


“They are getting about 12 to 18 grams a day in the official mining corridor,” said Victor Hugo Macedo, who oversees the reserve. “They are getting 60 to 80 grams in the buffer zone, and they are getting 150 to 200 in the reserve. The miners care more about that than what happens to Tambopata.”


The government has tried varied policies to contain illegal mining, including controls on the amount of fuel coming into the region, Mr. Pulgar-Vidal said. But he conceded that these efforts had had little success. The Peruvian tax authority recently estimated that more than $1 billion worth of gold had been smuggled out of the country just between February and October 2014.


In recent years, the authorities have sometimes swooped in by helicopter from the capital, Lima. But prosecutors said the miners often seemed to have been warned and were back in business within days. Corruption and organized crime, they said, helped drive illegal mining, and many of the mining camps were essentially lawless communities where slave labor and sex trafficking flourished.





Mr. Pulgar-Vidal hopes that the constant presence of armed marines and a stream of raids will persuade the miners to leave the reserve alone.


Critics are skeptical. Some suggest that the government may not really be interested in stopping illegal miners. Some Peruvian politicians openly argue that the miners, many of them from indigenous communities, should be allowed to earn a living, a popular stance in a country where half the population is under the poverty level.


Up close, the raids look doomed to failure. The marines and rangers are outmanned and under equipped. Even getting to their outposts is a challenge. The best routes are controlled by the miners and considered too dangerous, even for armed soldiers. So on a rainy day, we walked down a narrow path from daybreak through afternoon, but the soldiers had no radios to call for help when it quickly became flooded for vast stretches.


In rushing water full of debris, we all took baby steps looking for solid footing as the rain forest suddenly turned into a turbid lake. Weighed down by backpacks filled with water, the soldiers carried their weapons over their heads and tried to keep from going under, not always successfully.


The prosecutor who accompanies them on raids had gone ahead on the back of a dirt bike. But that was a luxury. The rangers have only four motorcycles — for about 100 men stationed at the two outposts along the river.



Yet there are at least 5,000 illegal miners in the area, and perhaps as many as 10,000. After a few raids, the marines were out of dynamite and resorted to a less sophisticated tactic: using mallets to smash the truck engines that miners use to power their derricks.


The boats used in the raids aren’t any faster than the ones the miners have, and they stalled often. While there has been no violence so far, a sense of menace was in the air. At times, the miners stood on the river’s edge, arms folded, as the marines and rangers sailed by.
Carlos Moscoso Garces, a marine, said it was a matter of time before trouble broke out. The miners shrugged off the occasional raid, but what happens once the cost of replacing destroyed mining equipment begins mounting?


“Then,” he said, “who knows what they will do.”


At one small encampment, a woman implored the soldiers not to destroy her home. She told the men she was just a single mother trying to make a living, so they put some food aside for her before setting everything else on fire.



Downriver, as soldiers made a bonfire of several motorcycles they had found, one young man tried to grab his. Forced to his knees, he told the soldiers he was only visiting friends, a story that no one believed. But there was no thought of arresting him, or anyone else. Miles from the nearest paved road and with no facilities for holding prisoners, the logistics made that impossible. Like everyone else encountered, he had no identification and was released without so much as a summons.


The marines are realistic. When they passed a giant tent city, with satellite dishes poking up and poles for many more dwellings under construction, they sailed on in search of a more manageable target.


By day’s end, the raiders had destroyed two dozen encampments and 15 mining derricks, and invaded mining camps far better equipped than their own. Along the way, the soldiers helped themselves, taking home a freezer, a satellite dish, a VCR, a television set, a soccer ball, a black-and-white puppy and a young pig for dinner.


At night, you could hear the sounds of the mining derricks starting up again.

Source: nytimes

Rising Nickel and Zinc Imports Add Fuel To Bull Market

Nickel and Zinc are two base metals that every commodity investor is talking about right now. Both metals have benefited from a bull narrative of supply shortfall this year.

Read more.....

Monday, 25 July 2016

Nickel and zinc prices hit multi-month highs

Prices for nickel and zinc rallied to multi-month highs on Thursday as investors bet on further supply disruptions for the industrial metals.

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Friday, 22 July 2016

Britain just got its first concrete sign that Brexit will destroy the economy

The collapse in the composite PMI to its lowest level since April 2009 provides the first major evidence that the U.K. is entering a sharp downturn..
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Schlumberger Joins Halliburton in Calling Bottom of Oil Downturn


The world’s two largest providers of oilfield drilling and fracking services have now declared that the worst may be over in the two-year-old oil market crash.

Schlumberger Ltd. said Thursday that the oil industry appears to have reached the bottom of the cycle, echoing smaller rival Halliburton Co., which on Wednesday said the North American market reached its lowest point in the second quarter and is poised for modest growth the rest of this year.

"They’re the two dominant players in the market, both of whom just called the bottom," James West, an analyst at Evercore-ISI in New York, said Thursday in an interview. "It’s a positive. Calling the bottom in the market sends the right signal and Schlumberger has a ton of credibility."

As the downturn dragged on, executives at the world’s largest oilfield services provider have had to push back their expectations for an improvement in drilling and fracking work, with crude prices remaining more than 50 percent lower than their peak in 2014.

Schlumberger reported an unexpected second-quarter loss of $2.16 billion, or $1.56 cents a share, compared with a profit of $1.12 billion, or 88 cents, a year earlier, according to a statement Thursday. The Houston- and Paris-based company was expected to post a $296.3 million profit, according to the average of 28 analysts’ estimates compiled by Bloomberg. The company also said it cut another 8,000 jobs in the second quarter after slashing a similar amount in the first three months of the year.

"In the second quarter market conditions worsened further in most parts of our global operations," Kibsgaard said in the statement. "But in spite of the continuing headwinds, we now appear to have reached the bottom of the cycle."

The stock, which closed 0.7 percent lower at $80.02, gained as much as 0.7 percent in after-hours trading. It traded at $80.43 as of 6:16 p.m. in New York.

The nearly doubling of oil prices this year has Schlumberger shifting its focus to renegotiate contracts with explorers and trying to recover some of the discounts it was forced to give during the downturn, Kibsgaard said.

Pricing Outlook

"That is a positive that they’re seeing that there is a little bit of appetite to renegotiate those contracts," Rob Desai, an analyst at Edward Jones in St. Louis who rates the shares a buy and owns none, said Thursday in a phone interview. "I think pricing will still be weak for a while. It could be a couple of years before pricing really recovers."

Schlumberger’s President Patrick Schorn said last month that the second quarter "may represent the final approach to a market bottom." In April, Schlumberger closed its $14.8 billion takeover of Cameron International Corp., marking the largest deal among oilfield contractors this year.

The service provider has made several rounds of job cuts to adjust to lower spending by its customers. The company has now cleaved off more than 50,000 jobs since the downturn began in late 2014, and its total headcount now stands at more than 100,000 with the addition of Cameron’s workforce, Joao Felix, a spokesman, said Thursday in an interview.

‘Modest Uptick’

Halliburton, the world’s second-largest oilfield services provider, reported a second-quarter loss of 14 cents per share, excluding certain items, earlier this week. The company also forecast a "modest uptick" in the U.S. rig count for the remainder of the year.

"They both are bullish for the medium- to long-term," Desai said. "Maybe Schlumberger is a little bit more cautious on the near term, but that’s to be expected, given the history of the two companies and Halliburton’s reliance more on North America."

(Schlumberger is scheduled to hold an earnings conference call Friday at 8 a.m. New York time, accessible at EVTS.)

Source: bloomberg

Thursday, 21 July 2016

EIU Global Forecasts Report 2016: Commodities forecasts

The Economist Intelligence Unit have produced their first global forecast since the Brexit vote. Please find below, their forecasts for commodities until 2020.

EIU Report...

Tuesday, 19 July 2016

Navigating Volatility in Stormy Markets


Pic by adweek
Q: Do you change your business or the way your business works?

Volatility has been an ongoing challenge for companies seeking to maintain a strong balance sheet and develop plans for long-term profitability. This is a challenge that management will need to deal with for some time.
Fluctuations in commodity prices have become more rapid and frequent as commodity demand has become increasingly unpredictable. The longer-term economic outlook is also volatile, leading to the possibility of substantial revisions to long-term metal price forecasts and making it hard for mining and metals companies to plan for the future.
The impact of China and emerging market demand is also difficult to understand or predict. So as prices fluctuate and there is limited pricing or demand visibility, management is struggling to plan operations and capex.
Investment decisions and business strategy need to factor in the variability in outlook, particularly as long-range business forecasts (e.g., metal/energy prices, FX rates) are updated. The following graph illustrates how copper prices and quarterly long-term consensus price forecasts have changed since 1 January 2000.




The key to success is agility and getting into shape to deal with volatility now. It is important to focus on six areas that will lead to more effective cash management.

  • Cost Reduction

Creating sustainable and long-term value
During the mining boom, miners saw costs escalate in some cases by over 200% (such as fuel, energy and people). Initially higher commodity prices masked these costs, but as prices have fallen, these embedded higher costs have been impacting bottom lines. Miners started eliminating costs from all areas of the business, including reducing capital expenditure and labor. However, there are still a lot of opportunities to remove costs from the business, and miners need to maintain a focus on building a long-term sustainable cost base while making certain that cost reduction activities do not contribute to value erosion. This can be achieved in the areas of general expenses, low-cost country sourcing, offshoring/outsourcing and procurement.

  • Working Capital

Unlocking cash in the sector
Mining companies focused on working capital have typically achieved reductions of 30% or more. For larger mining companies, this can mean reclaiming hundreds of millions of dollars of capital back into the business.
Processes and systems across the supply chain, particularly with regard to inventory, accounts payable, and WIP and finished goods, are the biggest areas where gains can be made. The next wave of improvements will require cultural change and data analysis.

  • Productivity

Productivity remains the number one operational challenge in the mining sector, with many still struggling to make an impact. Gains to date have been realized via tactical short-term solutions, but to really achieve sustainable gains, the focus needs to be on the long term. In our experience, most of the obvious opportunities across operations have already been addressed — it’s finding the next 10%–20% of productivity savings that can be difficult and complex.
A relentless focus on the elimination of loss at all levels is needed for the next wave of sustainable productivity improvement. We define loss as any gap between the achieved output and the potential productivity of an asset or a system of assets. It includes elements of reliability/availability, utilization rate and quality.
Whether the objective is a rapid uplift in productivity, or a long-term sustainable change, the principles remain the same. Companies need to embed sustainable loss elimination practices through employee engagement and an integrated end-to-end approach for long-term sustainable improvement in productivity.

  • Capital effectiveness

Making your existing assets work harder
A program built on the back of good asset management fundamentals will work as a platform to drive productivity and manage risk. Extracting more value from existing assets presents an opportunity to improve asset management capability. This can help to drive productivity and manage risk in a cost-constrained environment.
Key areas to achieve this is through advanced asset management, sustaining capital and capital productivity.

  • Portfolio Strategy

Capital allocation and portfolio strategy are critically linked
Empirical research suggests that companies that actively and dynamically manage their portfolio of assets achieve better longer-term returns than companies with a buy-and-hold strategy. For the mining sector, with capital decisions played over such a long period of time, and profitability so intrinsically linked to broader macroeconomic factors, effectively managing portfolios is a difficult task. This is made even harder with the heightened level of volatility being experienced.
Active portfolio management will remain a key priority in constructing an optimum portfolio. There needs to be a focus on optimizing the performance of assets through portfolio improvement and cost control measures.

  • Financing

Balance sheet flexibility is key during this period of volatility
While there is a significant level of debt across the sector, and leverage is high on the back of lower earnings, a large proportion of debt is covenant lite and many corporates have taken action to push out maturities and reduce servicing costs. The associated distress, therefore, is perhaps lower than might otherwise be expected in such difficult market conditions.
Balance sheet flexibility remains critical during this period of volatility, and so does the associated “right-sizing” of debt levels to the underlying profitability of operations. Releasing capital to pay down debt can be achieved via dividend cuts, divestments and streaming.

Sources: EY Bloomberg Reuters

Monday, 18 July 2016

Nickel Industry Feature–Philippine DSO Supply at Risk

Nickel Industry Feature–Philippine DSO Supply at Risk

At risk is the volume of the country’s nickel in ore exports which are critical to Chinese nickel production, and a potential hit to the Philippines’ reputation as an investment destination. The Philippines became the largest exporter of nickel in ore, which is essential to China’s NPI sector, following the implementation of the Indonesian ore export ban in January 2014. China imported 29.6Mt of Philippine ore and 41.1Mt of Indonesian ore in 2013, as it built significant ore stockpiles ahead of the Indonesian ban. Chinese imports of Philippine ore rose to 36.4Mt in 2014 and 34.3Mt in 2015, with......

Thursday, 14 July 2016

All change in the world of industrial metals trading?

China has loomed large over the world of industrial raw materials for many years.

The prices of metals from aluminum to zinc have long swayed to the beat of the world's largest manufacturing nation...

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U.S. Now Holds More Oil Reserves Than Saudi Arabia: Rystad

A new independent estimate of world oil reserves has been released by Rystad Energy, showing that the U.S. now holds more recoverable oil reserves than both Saudi Arabia and Russia. For U.S., more than 50% of remaining oil reserves is unconventional shale oil. Texas alone holds more than 60 Bbbl of shale oil, according to this new data....

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China on Pace to Meet Economic Targets This Year, Premier Says

Premier Li Keqiang said the Chinese economy is “basically stable” and on course to meet its major targets this year, with its second-quarter growth rate likely to be close to the first quarter’s 6.7% level when results are announced Friday...

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China Slapped With 193% Import Duties on Imports of Stainless Steel Sheet/Strip

Heavy Duties on Chinese Stainless.
As a result, Commerce calculated a preliminary subsidy rate of 193.12% based on adverse facts available due to the failure of these companies to cooperate in the investigation...
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Wednesday, 13 July 2016

Nickel shortage expected this year

International prices on the London Metal Exchange are at around $10,000 a ton, up 31% since a low in February on signs that the market bottomed out after sluggishness since 2014. The net long position of funds trading nickel on the LME is 50,100 lots, 2.8 times as many as at the start of the year.
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China says U.S. deliberately misread WTO rules in steel subsidy spat



China's Commerce Ministry said on Wednesday the United States had deliberately misinterpreted World Trade Organization (WTO) rules after the U.S. Commerce Department found in favor of subsidy rates for Chinese steel. 

The U.S. Commerce Department found in favor of anti-dumping measures for imports of stainless steel sheet and strip from China and said it had set a preliminary subsidy rate of 57.30 percent for a Chinese steel manufacturer, according to a preliminary finding released on Tuesday.

China's commerce ministry said in a statement it was not satisfied with the decision and that it would use the WTO dispute settlement process to defend its interests.

Recently, the United States levied high taxes on Chinese stainless steel, cold rolled steel, corrosion-resistant steel plate and other goods that served as a "man-made obstacle" and an effective "rejection of Chinese steel products", the commerce ministry statement said.

Source: Reuters

Tuesday, 12 July 2016

Brexit may 'spell the end' of high commodity prices

The late June decision by voters in Great Britain to leave the EU immediately hurt many markets, including commodities. The British pound dropped 8 percent to a 30-year low. The S&P GSCI - a benchmark commodity index - lost 3 percent the day after the vote. Oil was also a Brexit victim and lost 4 percent that day.
Read more......

Monday, 11 July 2016

Citigroup Backs Commodities for ‘17 in ‘Especially Bullish’ Call

“Citi is especially bullish commodities for 2017,” analysts led by Ed Morse wrote in an note received on Monday, two months after the New York-based bank said that raw materials’ markets had turned the corner. “The oil market is treading water for now, but the oil price overshot to the downside earlier this year and this is clearly setting the stage for a bullish end to the decade.”

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Saturday, 9 July 2016

Global nickel demand outlook flat for 2016, 2017 amid lack of drivers

World nickel consumption is expected to stay flat in 2016 and 2017 as a result of weak economic growth and no rise in steel production, the Australian Department of Industry, Innovation and Science said Friday in its June quarterly report on resources and energy.
Read more....

China Warns of Punishment for Delaying Coal, Steel Capacity Cuts

China has threatened to punish regional governments for failing to close unneeded coal mines and steel mills, adding pressure to carry out reforms as the country shifts away from industrial production.
Read full story...

Stainless Steel Round Bar Market: Global Industry Analysis, Growth, Trends, and Forecast 2016 - 2023

The rapid growth in oil and gas, construction, automotive, mining, and aerospace industries in recent years is fueling the global demand for stainless steel (SS) round bar significantly. These SS round bars offer excellent properties such as high corrosion resistance, tensile strength, electrical and thermal conductivity, magnetism, toughness, fire resistance, and sustainability as they can be recycled. These superior mechanical properties have led to the huge growth of the SS round bars market globally. On the basis of product type, SS round bars can be classified into categories such as Cr-Ni, duplex and super duplex, and high nickel alloys
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Brexit just a bump in the bull run for base metals

The EU referendum vote and the shock decision by 52% of the UK’s population to leave caused immediate shock waves throughout global financial markets: European stocks, the British pound, euro and global share prices all plummeted in the immediate aftermath, whilst safe-haven assets such as gold and the dollar rocketed up. Yet the base metals complex seemed to register only a small bump from the event, recovered quickly and is now higher than it was before the vote. Why is this?
Read the full article

How to Build a Strong Brand


Q: What makes a brand strong? If you had to make yours stronger, would you know how to do it?

Many factors influence the strength of a particular product or brand. If you understand these factors, you can think about how to launch a new product effectively, or work out how to turn a struggling brand into a successful one.

Let's have a look at Keller's Brand Equity model, also known as the Customer-Based Brand Equity (CBBE) Model.




The concept behind the Brand Equity Model is simple: in order to build a strong brand, you must shape how customers think and feel about your product. You have to build the right type of experiences around your brand, so that customers have specific, positive thoughts, feelings, beliefs, opinions, and perceptions about it.

When you have strong brand equity, your customers will buy more from you, they'll recommend you to other people, they're more loyal, and you're less likely to lose them to competitors.

The four steps of the pyramid represent four fundamental questions that your customers will ask – often subconsciously – about your brand.
The four steps contain six building blocks that must be in place for you to reach the top of the pyramid, and to develop a successful brand.

Let's look each building block in detail.

  • Brand Identity – Who Are You.

In this first step, your goal is to create "brand salience," or awareness – in other words, you need to make sure that your brand stands out, and that customers recognize it and are aware of it.
You're not just creating brand identity and awareness here; you're also trying to ensure that brand perceptions are "correct" at key stages of the buying process.

Ask yourself what decision-making processes do your customers go through when they choose your product? How are they classifying your product or brand? And, when you follow their decision making process, how well does your brand stand out at key stages of this process?

  • Brand Meaning – What Are You?

Your goal in step two is to identify and communicate what your brand means, and what it stands for. The two building blocks in this step are: "performance" and "imagery."

"Performance" defines how well your product meets your customers' needs. According to the model, performance consists of five categories: primary characteristics and features; product reliability, durability, and serviceability; service effectiveness, efficiency, and empathy; style and design; and price.
"Imagery" refers to how well your brand meets your customers' needs on a social and psychological level. Your brand can meet these needs directly, from a customer's own experiences with a product; or indirectly, with targeted marketing, or with word of mouth.

Ask yourself what type of experience you want your customers to have with your product? Take both performance and imagery into account, and create a "brand personality."

  • Brand Response – What Do I Think, or Feel, About You?

Your customers' responses to your brand fall into two categories: "judgments" and "feelings." These are the two building blocks in this step.
Your customers constantly make judgments about your brand and these fall into four key categories:
Quality: Customers judge a product or brand based on its actual and perceived quality.
Credibility: Customers judge credibility using three dimensions – expertise (which includes innovation), trustworthiness, and likability.
Consideration: Customers judge how relevant your product is to their unique needs.
Superiority: Customers assess how superior your brand is, compared with your competitors' brands.
Customers also respond to your brand according to how it makes them feel. Your brand can evoke feelings directly, but they also respond emotionally to how a brand makes them feel about themselves. According to the model, there are six positive brand feelings: warmth, fun, excitement, security, social approval, and self-respect.

Ask yourself What can you do to improve the actual and perceived quality of your product or brand?
How can you enhance your brand's credibility? How well does your marketing strategy communicate your brand's relevancy to people's needs? How does your product or brand compare with those of your competitors?
  • Brand Resonance – How Much of a Connection Would I Like to Have With You?

Brand "resonance" sits at the top of the brand equity pyramid because it's the most difficult – and the most desirable – level to reach. You have achieved brand resonance when your customers feel a deep, psychological bond with your brand.
Keller breaks resonance down into four categories:
Behavioral loyalty: This includes regular, repeat purchases.
Attitudinal attachment: Your customers love your brand or your product, and they see it as a special purchase.
Sense of community: Your customers feel a sense of community with people associated with the brand, including other consumers and company representatives.
Active engagement: This is the strongest example of brand loyalty. Customers are actively engaged with your brand, even when they are not purchasing it or consuming it. This could include joining a club related to the brand; participating in online chats, marketing rallies, or events; following your brand on social media; or taking part in other, outside activities.

Ask yourself what you can do to reward customers who are champions of your brand? What events could you plan and host to increase customer involvement with your brand or product?

Sources: Inc. mindtools, KL Keller,