Brand marketing does not get as much attention as trending strategies like content and social media. This makes sense to a degree — brand build is usually a natural result of a marketing strategy. Every marketing message contributes to a unified brand personality that ideally relates to the target audience.
There is a lot of value in focusing on branding in product marketing campaigns. Marketing experts know that commitment to maximizing brand equity creates high marketing ROI that lasts.
What is brand equity? It is how much profit margin a brand name holds. Brand values and associations are attached to your product line. The consumer perception of brands plays into purchase decisions, sometimes eclipsing more tangible factors like price or function.
Brand equity is a goal, centered on how you raise awareness, build recognition and create positive customer experiences.
What is Brand Equity?
Brand equity is the difference in perceived value a brand has from its generic version. This difference is sometimes called “sway” or “commercial value”.
If a brand has positive equity, a consumer will be more inclined to pay extra for it. For instance, you may choose a 12-pack of Coca-Cola rather than a 12-pack of store-brand cola. Despite the cost difference and nearly identical taste, your brand perception of Coca-Cola made you buy it.
Equity results from the interplay of several factors, each of which is often a leading business goal:
- Brand recognition: How recognizable is the brand behind a product or marketing message? The logos, spokespeople, and slogans of brands with high equity are immediately identifiable.
- Brand awareness: Positive brand perception is tied to the consumer’s awareness of the brand. Brand awareness indicates how acquainted consumers are with a brand’s unique selling propositions and values. Being familiar with these aspects of a brand determines whether or not they find it favorable. Businesses can help raise awareness through consistent messaging, solidifying the brand associations they want to communicate to their audience.
- Customer experience: How consumers interact with a brand has a major impact on brand equity. Has their product performed to expectations and solved the customer’s problem? How have interactions with salespeople been positive or negative? Everything from advertising to customer service adds to the customer experience and their feelings about your brand.
Why is Brand Equity Important?
There are a variety of brand equity definitions, but they all relate to the same concept: How much your brand is worth. Understanding and building brand equity is critical because it allows you to make more money with each sale.
When customers are drawn to brands, they will pay a certain amount more to have them. In many ways, this price premium you can charge is a great measure of brand equity. Production costs do not change and you keep the same amount of customers, but greater brand equity increases revenue.
Brand equity has other benefits in building ROI beyond raising profit margins — it decreases costs, too. As you build equity, you develop a strong brand reputation within communities. At a point, you can focus more on maintenance than on investing in building that reputation.
When you have positive brand equity, customers will naturally seek you out. You will not have to spend as much money on marketing because you have a loyal customer base. This is especially beneficial while expanding products and services, as customers will likely be ready and willing to buy.
How to Build Brand Equity
Brand equity should be a foundational principle in the majority of your business operations, especially marketing. Identifying your target customers and understanding how to influence their perception is crucial. Your marketing communications need to be based in a consideration of the factors that build brand equity.
Here are four key ways you can use your marketing tactics to boost your brand equity:
Display Brand Values and Beliefs
Customers have more needs than the immediate problems that your product solves. Many people choose products for emotional, social or psychological reasons. A customer may value their environmental responsibility, for example, and opt for products that are sustainably sourced.
Target personas are valuable in giving you values and beliefs to amplify through your brand. When your brand embraces and commits to promoting your customers’ values, you will create a stronger bond with them. You will attract more ideal customers along with motivated employees and business partners who want to work with you.
Expand Brand Awareness
When customers can more easily identify and associate your brand, you contribute to your brand equity. This can be positive or negative, however, so you must be careful in directing those associations. The best way to do this is in creating an exceptional customer experience.
Providing superior customer service and ongoing value through your sales and marketing should be a priority. Utilizing loyalty programs, 24/7 support and informational content are just a few ways to build a better experience.
Stories and symbols behind your brand are essential in communicating your values. Using consistent imagery and verbiage helps position your brand and make it immediately identifiable. Meanwhile, social media, email newsletters and your website can share your story. When you can get your brand’s voice in front of your customer, you can connect on an emotional level.
Inspire Positive Feelings and Conclusions About Your Brand
Directing your customers’ feelings about your brand is similar to relaying your brand’s values. Customers who have positive feelings about your product are more likely to be enthusiastic about it. They act as brand ambassadors by being loyal and promoting your brand via word of mouth.
Creating positive conclusions about your brand entails supporting your brand’s credibility, quality, utility and position among competitors. Working alongside positive feelings, this is the logical side of consumer buying that is critical in earning their business. It’s vital to maintain your integrity and consistency along these lines to improve expectations and, subsequently, the customer experience.
Nurture Loyalty Through Powerful Bonds With Customers
A perfect brand equity model is one that creates loyal followings. Customers develop deep psychological connections, with brands almost becoming a part of their identity. They come back to the same brand confidently and without question.
When customers become part of a community, you know that you have strong brand equity. Your customers love talking about your brand, promoting it and even gathering to celebrate it. Jeep is an excellent example of a brand that developed a loyal following. It’s not uncommon for owners to flaunt their vehicles on social media pages and attend special Jeep events.
Products and/or Companies That Have Outstanding Brand Equity
The best examples of brand equity are those brands that have established enduring positive positions with consumer culture. These brands have successfully elevated their brands above the competition in the minds of the consumer. With little need to advertise, these brands thrive on exceptional recognition, awareness and customer experiences.
Here are eight companies that created amazing brand equity. With an understanding of how they leveraged the power of branding, you can better direct your brand marketing strategies.
Costco has built a close following by supplying exclusivity, value and care. Members get private access to discounted products, inexpensive gas and a truly unique shopping experience. The company has also developed a positive brand image from their superior employee satisfaction. Consumers subsequently perceive the company’s ownership and the brand as caring and committed.
The Kirkland Signature brand has benefited from the positive associations that Costco has nurtured. This has allowed the product line to grow unlike any other store brand. The Kirkland name can be found on food, drinks, household goods and even clothing. These products cost much less than brand names, but its perceived quality is enhanced by the Costco image.
Porsche sits at the pinnacle of automotive quality, firmly establishing themselves as an elite luxury brand. Their brand equity is apparent in the association their cars have with status. Car shoppers often see the Porsche logo as validation of their success. This allows Porsche to charge premium prices, which actually work to further their luxury appeal and brand equity.
Starbucks is as identifiable as it is abundant. The “Starbucks across from a Starbucks” cliche is an apt indicator of the brand’s success.
The brand built its equity through social responsibility and their positioning as a higher-tier coffee shop. Customers feel more like aficionados when ordering off the menu. As a result, their higher priced coffee gives customers a greater feeling of esteem. Combine this with strategic limited-time offerings, like Unicorn Frappuccinos, and customers have plenty of reasons to keep returning.
Nike “Just Do It”
Few company taglines are as iconic as Nike’s “Just Do It” campaign. A short slogan supporting a simple logo that Nike has been riding to great success for generations. By stimulating an emotional response and being memorable in its simplicity, Nike developed a psychological connection with their customers.
The “Just Do It” slogan is more than a tagline — it’s a lifestyle. In these three words, Nike created inspirational meaning. They motivate their fan base to achieve their loftiest dreams and never stop pushing. When buying their products, customers feel even more assured that Nike will help them reach their full potential.
Google, like Apple, is a great example of using simple iconography to create a timeless, appealing brand image. However, while their brand recognition is strong, the real strength in their equity comes from their principles.
Promoting their brand value and beliefs was instrumental in acquiring a massive consumer following and quality employees. Google gives their employees relative freedom in how they conduct their business. They value their people so strongly, and their employees recognize their integrity. The company successfully created a culture built on belief in their work and a true passion for positively impacting the world.
These qualities have given Google a staff that excels at creating quality products. Starting with search, Google has been dedicated to mastering every aspect of their growing business. There is no question that Google returns the best results. As their product offerings expand, users now immediately assume premium quality and are fast to adopt them.
Microsoft has been a quiet giant in recent years. An older brand, Microsoft does not get as much buzz as flashier, newer brands like Google or Apple. Nonetheless, this has not stopped them from surpassing Google in brand value in 2020.
Microsoft may not spur the same loyalty as Apple, but its brand awareness and, surprisingly, brand image are excellent. In recent years, young adults have shifted their perception of Microsoft. Having essentially run a monopoly for a long time, Microsoft felt like it was forced on consumers. However, as they started embracing innovation in products, marketing and enterprise solutions, Microsoft has gained relevance in profitable markets.
McDonald’s golden arches have been a beacon for hungry road-trippers for generations. Despite what many would call sub-par products, McDonald’s has still generated millions of loyal customers. The company has excelled by delivering on its marketing, meeting customer expectations and creating confident repeat customers. By setting a clear promise in its advertising and fulfilling it in-store, McDonald’s earned its mass of loyal followers.
Over the past century, Disney has become a case study in wielding emotion to create legions of fans. Of course, they are excellent at creating child-friendly content to get new young viewers. But the nostalgia they generate in older generations allows them to profit off of an even wider audience.
Disney gets everyone, young and old, to flock to Disneyland and enjoy movie night together through storytelling. They create strong emotional reactions in the stories they create, which they leverage in ensuing product lines and licenses. These stories stay with their audience, retaining their meaning and keeping them relevant for years.
Doing a brand audit to find strengths and weaknesses in your brand can be a huge benefit. Building brand equity should always be considered in every campaign and business practice. Brand tracking is beneficial, but simply asking “How does this impact our brand?” is valuable for any effort.
If you are struggling to build brand equity, the Selling Revolution can help. We consult with clients to understand their challenges and opportunities to create winning sales and marketing strategies. With our expert guidance, clients create more cohesive branding through unified sales and marketing efforts. To learn how we can help drive greater brand equity and better customer experiences, contact our team today.