How Brand Equity Can Be Enhanced
Brand equity, in marketing, is the worth of a brand in and of itself — i.e., the social value of a well-known brand name. The owner of a well-known brand name can generate more revenue simply from brand recognition, as consumers perceive the products of well-known brands as better than those of lesser-known brands.
he purpose of brand equity metrics is to measure the value of a brand. A brand encompasses the name, logo, image, and perceptions that identify a product, service, or provider in the minds of customers. It takes shape in advertising, packaging, and other marketing communications, and becomes a focus of the relationship with consumers. In time, a brand comes to embody a promise about the goods it identifies—a promise about quality, performance, or other dimensions of value, which can influence consumers' choices among competing products. When consumers trust a brand and find it relevant, they may select the offerings associated with that brand over those of competitors, even at a premium price. When a brand's promise extends beyond a particular product, its owner may leverage it to enter new markets. For all these reasons, a brand can hold tremendous value, which is known as brand equity.
Young & Rubicam, a marketing communications agency, has developed the BrandAsset Valuator, BAV, a tool to diagnose the power and value of a brand. In using it, the agency surveys consumers' perspectives along four dimensions:
Differentiation: The defining characteristics of the brand and its distinctiveness relative to competitors.
Relevance: The appropriateness and connection of the brand to a given consumer.
Esteem: Consumers' respect for and attraction to the brand.
Knowledge: Consumers' awareness of the brand and understanding of what it represents.