Know-How Exchange : Research/Metrics

BDI is calculated by:

(A% / X%) * 100

where A is the percentage of a brand's total sales in a specific market area, and X is the percentage of the total population in that market area. [From https://en.wikipedia.org/wiki/Brand_Development_Index]

Because the BDI is a ratio of ratios, there are a few ways you can calculate it, and they are all essentially the same.

The BDI tells you how a brand's penetration in one area compares to the brand's penetration in the larger universe (e.g., the country).

Typically brand penetration is expressed as sales per thousand population. Thus, if a brand is selling $25,000 per thousand population in Oklahoma and $20,000 per thousand population in the US as a whole, then the BDI for Oklahoma would be 125 (25000/20000 * 100).

Another way to say that is that someone in Oklahoma is 25% more likely to purchase the brand when compared to the average American.

You could also take the ratio of market share in your store and compare it to the market share in your geographic "universe." A BDI of 125 in that case would mean that a consumer in your store is 25% more likely to purchase the brand when compared to the average consumer in your trading area.

Hope this helps. BDI calculations get easier when you've stayed awake in algebra class!