Brand equity refers to the importance of a brand in the customer’s eyes, while brand value is the financial significance the brand carries. Both brand equity and brand value are educated estimates of how much a brand is worth.
Brand Equity is the value of a brand , or can be summarized as the perceived value by consumers over other products. The equity of your brand is important because, if your brand has positive brand equity , you can charge more for your products and services than the generic products or other competitors.
In effect, the market bears higher prices for brands that have high levels of brand equity . Positive brand equity increases profit margin per customer because it allows a company to charge more for a product than competitors, even though it was obtained at the same price.
Build Brand Equity Step 1 – Identity: Build Awareness. Begin at the base with brand identity. Step 2 – Meaning: Communicate What Your Brand Means and What It Stands for. Step 3 – Response: Reshape How Customers Think and Feel about Your Brand . Step 4 – Relationships: Build a Deeper Bond With Customers.
Brand equity refers to a value premium that a company generates from a product with a recognizable name when compared to a generic equivalent. Companies can create brand equity for their products by making them memorable, easily recognizable, and superior in quality and reliability.
Some examples of firms with brand equity—possessing very recognizable brands of products—are Microsoft, Coca-Cola, Ferrari, Apple, and Facebook. If done right, a brand results in an increase in sales for not just the specific product being sold, but also for other products sold by the same company.
Brand equity is a marketing term that describes a brand’s value. That value is determined by consumer perception of and experiences with the brand . Positive brand equity has value: Companies can charge more for a product with a great deal of brand equity .
Brand equity refers to the total value of the brand as a separate asset . The effect of this intangible asset is also visible in the financial books as the market share, prices, demand, and profitability.
The four benefits of brand equity are: Less-drastic declines in revenue when the team loses. Ability to charge price premiums. Greater corporate interest.
In this method of brand equity measurement, brand value is calculated by first taking the price difference between the branded product and a generic product, and then multiplying the difference with the total branded sales volume.
The Keller model is a pyramid shape and shows businesses how to build from a strong foundation of brand identity upwards towards the holy grail of brand equity ‘resonance’: where customers are in a sufficiently positive relationship with a brand to be advocates for it.
Boosting your brand equity 1) Quality products and services. This is the backbone of your brand . 2) Competitive analysis. A strong brand is a brand that can adapt to market changes. 3) Consistent brand image. 4) Listen to customers.
Increase brand awareness – Social media can give you a voice to communicate to a huge number of customers and potential customers that you would not otherwise have a way of reaching. By reaching out to more people you can raise awareness of your brand and increase your customer-base.
The brands of the world with the highest brand equity.
|Brand||Brand Equity (USD, billions)||% of Market Cap|
Brand equity has four dimensions— brand loyalty , brand awareness , brand associations , and perceived quality, each providing value to a firm in numerous ways. Once a brand identifies the value of brand equity, they can follow this roadmap to build and manage that potential value.