Brand Equity: Measuring the Intangible Worth of a Company's Brand Name
Brand Equity, a commercial value derived from positive consumer perceptions about a brand and its offerings, plays a crucial role in the success of businesses. It results in higher sales, increased profits, and customer loyalty, symbolising the relationship consumers have with a brand and influencing their perception, feelings, and actions towards it.
Brands like Dove and Wendy's have leveraged the power of word of mouth and emotional appeal to enhance their brand equity. Dove, for instance, has started testimonial advertising, while Wendy's effectively handles social media, engaging with customers and fostering loyalty.
Netflix and Amazon are examples of brands that have maintained their brand equity by understanding trends and preferences. They have adapted their offerings to meet changing consumer needs, demonstrating their commitment to customer satisfaction.
Brand equity is built on consumer knowledge about a brand, including its values, unique selling propositions, and competitive advantage. Focusing on brand elements and building brand equity can help in managing brand equity. Consistency over a long period of time is important for a product to become a brand.
Effective marketing campaign strategies to build brand equity focus on increasing brand awareness, creating emotional connections, ensuring consistency, and fostering customer loyalty and engagement. These tactics include defining the brand's purpose and unique value, testing and optimising brand positioning, increasing brand awareness, ensuring consistency in visual and narrative identity, engaging with customers, using local and community-driven campaigns, hosting or sponsoring events and webinars, leveraging interactive tools and gamification, and measuring campaign effectiveness.
With good brand visibility, a pull is created for your products in the market. A proper marketing mix contributes to making a product which is a delight to be obtained, and which in turn contributes to the brand equity of the company. It is easier to introduce new line of products or services with a good Brand Equity.
Brands like Walmart, Microsoft, P&G, HUL, Verizon, AT&T, Apple, Google have maintained a consistent approach towards customer satisfaction and brand building. Coca-Cola is known as a master of branding and has left many FMCG companies behind with its branding initiatives.
However, brands can fail due to various reasons such as lack of innovation, poor customer service, and lack of brand differentiation. Reactions to problems are important in maintaining brand equity. For instance, Maggi's brand image was positively affected by Nestle's response to a problem.
Negative effects of Brand Equity include lower sales and revenue due to consumer preference for generic products or competitors' offerings. Brands that give a positive experience to its customers will receive positive word of mouth and increase brand equity. A good Brand Equity can command premium prices for products and services.
Understanding trends and preferences can help a brand develop its brand equity. Being proactive in brand building and brand equity management can help a firm in the long run. Thinking long term is important for managing brand equity. Keller's Brand equity Model (CBBE Model) is a model that can be used to understand and manage brand equity. Understanding the consumer psyche is also important for managing brand equity.
In conclusion, building and managing brand equity is essential for business success. By focusing on brand elements, creating emotional connections, ensuring consistency, and fostering customer loyalty and engagement, businesses can enhance their brand equity and achieve long-term success.
- The effective handling of social media, as demonstrated by brands like Wendy's, plays a significant role in enhancing brand equity by engaging with customers and fostering loyalty.
- Brands like Netflix and Amazon maintain their brand equity by understanding trends and preferences, and adapting their offerings to meet changing consumer needs, thereby demonstrating their commitment to customer satisfaction.
