CREATING BRAND EQUITY

AJIT THATTE

WHAT IS BRAND EQUITY

American Marketing Association defines a brand as a name ,term,

sign, symbol , or design ,or a combination of them, intended to
identify the goods or services of one seller or group of sellers and to
differentiate them from those of competitors. A brand is thus a
product or service that adds dimensions that differentiate it in some
way from other products or services designed to satisfy the same
need.
These differences may be functional, rational ,or tangible.
They may also be more symbolic , emotional, intangible.

ROLE OF BRANDS

Brands identify the source or maker of a product and allow

consumers to assign responsibility to a particular supplier.
Brand helps in simplifying consumer decision making and also
reduce risk.
Brands simplify product handling or tracing
It helps in organizing inventory and accounting records

Brand also offers the firm legal protection for unique features or
other aspects of the product
Brand provides intellectual property rights
Brand loyalty can result in repeat sales and higher price

SCOPE OF BRANDING

Branding is endowing products and services with the power of a

brand. Branding is all about creating differences
Branding involves creating mental structures and helping
consumers organize their knowledge about products /services in a
way that clarifies their decision making.
Branding can be applied virtually anywhere a consumer has a
choice

DEFINING BRAND EQUITY

Brand equity is the added value endowed to products/ services. This

value may be reflected in how consumers think , feel, and act with
respect to the brand as well as prices, market share and profitability
that the brand commands for the firm.
Brand equity is an important intangible asset that has psychological
and financial value to the firm.

Customer based brand equity can be defined as the differential

effect that brand knowledge has on consumer response to the
marketing of that brand.
Brand knowledge consists of all the thoughts , feelings , images,
experiences , beliefs etc. which get associated with brand.

BRAND EQUITY AS A BRIDGE

The quality of investment in brand building is the critical factor , not

necessarily the quantity , beyond some minimal threshold amount.

A brand is essentially a marketers promise to deliver predictable

product / service performance.

A brand promise is the marketers vision of what the brand must be

and do for consumers.

BRAND EQUITY MODELS

Four established models are
Differentiation

Relevance

Esteem

Knowledge
Differentiation and relevance combine to determine brand strength.
Esteem and knowledge together create brand stature, which is more
of a report card on performance

AAKER MODEL

1.
2.
3.
4.
5.

Prof. David Aaker views brand equity as a set of five categories of

brand assets and liabilities linked to a brand that add to or
subtract from the value provided by product/ service to a firm and/
or to that firms customers. These categories of brand assets are:
Brand loyalty
Brand awareness
Perceived quality
Brand associations
Other proprietary assets like patents , trademarks and channel
relationship
Another important concept for building brand equity is brand
identity the unique set of brand associations that represents
what the brand stands for and promises to customers.

BRANDZ

1.
2.
3.
4.
5.

Marketing consultants Millward Brown and WPP have developed

the BRANDZ model of brand strength , at the heart of which is the
brand dynamics pyramid. According to this model ,brand building
involves a sequential series of steps, where each step is
contingent upon successfully accomplishing the previous step.
The objectives at each step in ascending order are
Presence do I know about it ?
Relevance does it offer me something ?
Performance can it deliver ?
Advantage does it offer something better than others ?
Bonding nothing else beats it.

BUILDING BRAND EQUITY

Main sets of brand equity drivers are :
The initial choices for the brand elements or identities making up the
brand
The product and service and all accompanying marketing activities
and supporting marketing programs
Other associations indirectly transferred to the brand by linking it to
some other entity