Brand Equity – a vital investment for the future

The “brand” itself is a distinguishing name and / or symbol such as a logo, trademark, or even pack design, intended to identify the origin of the good or service. The brand differentiates the goods or services from those of competitors. The brand signals to the customer the origin of the product, protecting both customer and producer from competitors who may attempt to provide products that “appear” to be identical.

Goods and services are often referred to as tangible and intangible, I recall teaching young marketers to look at tangibles and intangible benefits, when assessing their products or services. The most important “assets” of any business are intangible - including the base of loyal customers, service aspects, brands, symbols and slogans - and the brand’s underlying image, personality, identity, attitudes, familiarity, associations name awareness and simply the way it makes you feel.

These assets, along with patents, trademarks, and channel relationships, comprise brand equity, and are a basic source of competitive advantage for the company. By developing strong and consistent images, “great” brands generate hidden assets or “brand equity” that give them distinct advantages. Brand equity is a form of wealth that is closely related to what accountants call "goodwill."

A brand is a promise made to its customers. Brand equity is initially built by laying a foundation of brand awareness that is consistent, focussed and has a clear direction - a positive brand image results in, and is ultimately maximised by high levels of brand loyalty.

Brand equity has been defined as the set of consumer associations and behaviors that allows the brand to earn greater volume or margins than it could without the brand name. It is the component of overall preference that cannot really be explained by objectively measured attributes. Advertising and promotions play a large part in creating this image to the market and general public.

As we often hear, image is everything – brand image is everything. It is the sum of all tangible and intangible traits; the ideas, beliefs, values, prejudices, interests, features & ancestry that make it unique. A brand image visually and collectively represents all internal and external characteristics, the name, symbol, packaging, literature, signs, vehicles and culture.

It's anything and everything that influences how a brand or a company is perceived by its target market, whether it is mass audience or a single customer. Delivering the brand’s message and image to the target audience is what promotions are all about. More companies are relying on below the line activities such as sales promotions, merchandising, trade incentives, loyalty programs, direct mail and sponsorship to leverage their brands above and beyond the competitors.

Contests, massive sweepstakes, collect-to-get redemptions and match’n win competitions create awareness and can be structured to increase purchase frequency, influence or establish buying patterns, sway or switch loyalty, provide incentives to try, buy and repeat purchase or totally self liquidate.

Brand image may be the best, single marketable investment a company can make. Creating or revitalizing a positive brand image is a basic component of every business and lays a foundation on which companies can build their future.