A brand is a logo, symbol, or name associated with a product. The impact that a brand has on consumer purchases or perceptions about a product is known as brand equity. The word equity indicates that an asset has been generated.
In brand equity, the asset is intangible and is measured in terms of the value attributed by a consumer or potential consumer of the product or service. Brand equity translates into consumer goodwill and propensity to prefer or buy a branded product or service.
Asset
Brand equity is one of the most important intangible assets of the company and just like other assets, this too can be sold, licensed or leased to others.
Price Premium
A brand having a positive brand equity can charge more for its product than the actual market price.
Increases Market Share
A positive brand equity often results in more loyal customers who prefer one specific brand over others and in-turn increases its share in the market.
Components of Brand Equity
Brand Awareness
Brand Associations
Perceived Quality
Brand Experience
Brand Preference
Brand Loyalty
Here’s a tip:
Brand Differentiation
Qualitative and Quantitative Approaches
Understand Customer Brand Attitude
Positive and Negative Brand Equity
A brand can have either positive or negative brand equity. While positive brand equity helps the company to maintain superiority over its competitors and expand its product lines, a negative brand equity as in the case of Volkswagen, which was held guilty for emission scandal, could even hurt the current product lines under the brand and have a long-lasting negative effect on the brand positioning.
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