The purpose of brand equity metrics is to measure the value of a brand which is overall important part of brand management. A brand encompasses the name, logo, visual communication, 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 have brand trust 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, known as brand equity.
There are many ways to measure a brand. Some measurements approaches are at the firm level (firm level approaches measure the brand as a financial asset), some at the product level (to compare the price of a no-name or private label product to an “equivalent” branded product), and still others are at the consumer level (to map the mind of the consumer to find out what associations with the brand the consumer has). All of these calculations are, at best, approximations. A more complete understanding of the brand can occur if multiple measures are used.
Adapted from wikipedia.
How to define brand equity?
Brief brand equity definition: it is a term for the marketing effects and outcomes that accrue to a product with its brand name compared with those that would accrue if the same product did not have the brand name.
Brand equity definition explained: brand equity plays a big role in marketing: a well-known brand name is that, the company can sometimes charge premium prices from the consumer. And, at the root of these marketing effects is consumers’ knowledge. In other words, consumers’ knowledge about a brand makes manufacturers and advertisers respond differently or adopt appropriately adept measures for the marketing of the brand. Brands are one of the most valuable assets a company has. Brand equity is one of the factors which can increase the financial value of a brand to the brand owner, although not the only one. Elements that can be included in the valuation of brand equity include (but not limited to): changing market share, profit margins, consumer recognition of logos and other visual elements, visual communication, brand language associations made by consumers, consumers’ perceptions of quality and other relevant brand values.
Brand equity is strategically crucial, but famously difficult to quantify. Many experts have developed tools to analyze this asset, but there is no universally accepted way to measure it. In a survey of nearly 200 senior marketing managers, only 26 percent responded that they found the “brand equity” metric very useful.
Adapted from wikipedia.
Brand management is a broad term, particularly used in marketing as an application of techniques to a specific product, product line or a brand. Brand management broadly includes brand orientation, brand positioning, brand equity definition and measurement, brand engagement and implementation.
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