What is brand equity and why is it valuable?

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Brands of Desire share their thought on brand equity and its valuable aspect.


Brand equity is a phrase used in the marketing industry to refer to the commercial value of a brand. Brand equity is associated with wide recognition, and creates brand loyalty, that is carried beyond price or any other service bump in the road. It is the quality that motivates your customers to recommend your brand to their friends or colleagues. Everyone wants it, but building brand equity when you are more likely to qualify for the Inc. 500 rather than the Fortune 500, can be tricky.
The three major steps that need to be taken for building brand equity are:
  • The first and most important step is to invest in your brand and establish a strong brand identity in the market.
  • The next step is to maintain the equity generated and to prevent any equity leakage.
  • And finally, it is important to make sure that the equity generated makes a positive impact on your company’s balance sheets.
Some useful tools:
Brand KPI stands for Brand Key Performance Indicators, which depict the outcome of the measures taken in building a brand, based on the impact the brand makes on its target audience.


You might already know about YouTube Analytics, Google Analytics, and Adwords but what is Brand Lift?
Brand Lift measures the direct impact your YouTube ads are having on perceptions and behaviors throughout the consumer journey. Within a matter of days, Brand Lift gives you insights into how your ads are impacting the metrics that matter, including lifts in brand awareness, ad recall, consideration, favorability, purchase intent, and brand interest, as measured by organic search activity. You can easily optimize your campaigns mid-flight, based on these near real-time results, broken out by demographics, frequency, and more. It’s a considerable tool for a major YouTube based marketing campaign.
The kind of impact that Nike or Starbucks has on the consumers can be categorized under positive equity. We can, therefore, say that Brand Lift works for brands that are known for their quality, dependability, and utility.
But there is also such a thing as negative brand equity that works against brands that have become synonymous with unreliability and poor performance. Here are a few case studies, to describe the effects of both positive and negative brand equity on the brand:
  1. Apple

Apple has done phenomenally well, and built a strong brand equity around their brand. That is why,  iOS 11’s performance throttling issues and bugs last year , did not cause much damage to the brand. (read more here – http://nerdcasm.com/apple-slowing-older-iphones-bad-sounds/ )
In fact, Apple swiftly made up for these performance issues by deciding to cut down on the number of new features and bring their focus back to maintaining the stability and fluentness of the OS itself, when they released iOS 12.
It is important to note that such glitches and bugs on a production release would have opened a firestorm of criticism for any other lesser known brand, but Apple’s strong and established brand equity, only helped the brand overcome such incidents with almost nobody noticing it.
  1. Adobe

If you have a great product filling a genuine need, it’s just a matter of time until someone else comes along trying to do what you do, even better than you do it. Adobe’s extensive suite was a sole player in the market and faced no competition for a long time.
However, over time the many glitches, bugs and crashes in Photoshop as well as Premiere Pro, forced industry professionals to start looking for newer and better options. This is when software like Apple’s Final Cut Pro, Da-Vinci Resolve, and Affinity Photo Editors started to attract all the attention as they took over as key players in the market.
  1. Internet Explorer

Once people form an opinion about your brand, good or bad, it’s difficult to change it. The best example for this is Internet Explorer.  For years, developing for the web meant working with the legion of IE hacks that other browsers didn’t have. However when Firefox and Chrome arrived it changed everything.  Over time the consumer share of IE dropped, and everyone considered it to be old and outdated.
Microsoft tried to turn it around, by introducing the Microsoft Edge Browser, but it was already too late for the brand by then. Consumers had already formed a fixed opinion of the brand, that was not going to change despite it actually being a faster and more energy efficient browser than Chrome.
Brands of Desire is a management consulting firm focused on building brands.