Sometimes even creative professionals need a little more education.
We were sitting around yesterday discussing different ways to increase the long-term value for our clients brands. And during the meeting someone said, “so the question is: are there other ways, in addition to what we are doing, to measure brand equity?” To which one of team said, “Brand equity, is that like home equity?” Brand Equity Basics – it sounded like a great blog topic to me, at the time.
What is Brand Equity?
In a nut shell it is the difference between of benefits between having a brand name as opposed to not having one. When your brand is well-known enough then you can charge people more money, or premium prices, for your product. A few examples of brands that are able to sell at premium prices include; Nike, Adidas, Apple, Chiquita bananas, VW and TOMS. And a couple of non-name brands include companies like; Jewel Companies Generic Cola and Kroger’s – Naturally Preferred. But even house brands are beginning to gain brand equity, like Boots skin care products being sold at Target in the US. However, in the ever-changing world of marketing even generic brands such as No is growing brand equity and using it to increase prices for products.
What isn’t a Brand?
Because everyone seems to believe that they understand what a brand is – I thought it might be a good moment to write about what a brand isn’t. A brand isn’t a logo – according to Marty Neumeier – and that is a key thing to remember. That means that things like the Nike Swoosh, the 3-strips from Adidas, the golden arches of McDonald’s or the white apple from Apple is not a brand, but a logo. This is a key thing to remember and not get confused about.
How we attempt to measure Brand Equity?
A brand’s equity is ultimately derived from the actions and words of consumers. As marketing professionals we are constantly testing ways to effectively measure the value of a brand for stakeholders. There are three key levels for measuring a brand are at the corporate, product and consumer level.
Corporate level – This is where a firm makes a calculation regarding how much the brand is worth as an intangible asset.
Product level – This is a measurement where one compares the price of a no-name or private label product to an “equivalent” branded product. This is very difficult when you are attempting to predict the worth and achieve FMA.
Consumer level – Attempts to map the mind of the consumer to find out what associations with the brand the consumer has. In this case high brand equity is associated with strong and favorable high levels awareness.
- Microsoft Continues to Build Brand Equity (imcseattle.wordpress.com)
- How Do You Measure Brand Equity and Impact? (theunemploymentdojo.wordpress.com)
- New generation brands control the “route to consumer” (wheresthesausage.typepad.com)
- A Little on Nike – logo, tagline and advertising (oeilsj.wordpress.com)