Brand Equity

A Brand equity is as much asset as a factory, plant and machinery are. A brand does not become an asset as soon as it is born.

It is “Build up” over a period of time. Before it comes into existence, there is along development process at a greater cost. After creation, there is investment to improve it continuously.

Brand Equity is just the process of Brand building.

A good example of brand equity is Wills Filter Cigarettes which has a heritage of more than three decades and which has taken close to 3 times increase in its stride and yet it holds, nurtured and nourished & continuously freshened.

“A Brand Equity represents the total accumulated value or worth of a Brand.”

“Brand Equity is simply the reason one should buy a specific brand instead of a competitive Brand”. Defines brand equity as, “A set of assets and liabilities associated with the brand.”

Source of Brand Equity

According to the diagram, there are four assets which creates & enhance the brand equity.

1. Brand Awareness.


2. Brand Loyalty.


3. Perceived Quality of the brand.


4. Brand Association.

Brand Awareness

The brand Awareness is a factor contributing to brand equity. It is the ability of a potential buyer to recognize or recall that a brand is part of a product category.

In other words, the customer should be able to identify a firm’s product in the retail stores or be able to recall its brand whenever he or she thinks of the product.

How to build or Increase Brand Awareness

To achieve high awareness, company has to follow following communication tasks.

• Be different and memorable.


• Involve a slogan or jingle.


• Expose the Brand Symbol.


• Get into the news.


• Sponsors major events.

Repeat the communication or increase the frequency to create impact.

Brand Loyalty

The brand loyalty is the ultimate goal a company sets for a branded product. A brand loyalty is consumer’s preferences to buy a particular brand in a product category. It occurs because consumer perceives that the brand offers the right product features, image or level of the quality.

• Brand Loyalist have the following mindset:


• I am committed to this brand.


• I will recommend this brand to others.

Process to create and to maintain Brand loyalty

• Create an Unbeatable product.


• Give customer an incentive to repeat purchase.


• Make it easier to buy your brand than competing brands.


• Go to your customer


• Become a customer service champion.


• Know your trophy customer and treat them best of all.

Perceived Quality

If a brand is perceived to be of premium quality, the customer will be willing to pay a premium for it. Perceived quality is how customer evaluate different brands on quality.