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Top-Shelf Tip No. 195:

"Your premium brand had better be delivering something special, or it’s not going to get the business."

Warren Buffett

Building Brand Equity: What To Know

Every business has a brand. And most brands have an associated logo—a symbol or type treatment to represent the brand. Think Target, General Electric or even the NFL. And when you associate these logos and organizational names with the brand, you begin to develop a bias about it. Perhaps when you think of Target, you are reminded of bargains and things you need for the home. You may associate the GE brand with innovation, lighting and other products and services. When you think of the NFL, you are connected to thoughts of football, coaches, players and tradition.

In these examples, the brand has an impact on our perceptions about the company and its products. This perception is known as brand equity. It's the value that is generated by the brand. And brand equity translates into the propensity to prefer or buy a specific branded product or service.

In this issue of Promotional Consultant Today, we'll examine the key steps for measuring your company's brand equity from business writer GiGi DeVault and look at why brand equity is important for the success of your business.

Clarify Brand Equity Perspective. Brand equity can be viewed from several different perspectives. First, how much more will a consumer pay for a product or service that has your brand over a product or service that is generic? Next, how does the value of your brand lead to the introduction of other products? Also, how does the launch of a new product or brand impact your existing brand? Also, assess the customer-based brand equity—how consumers think, feel and act with respect to the brand.

Determine Brand Equity Research Goals. Understanding your brand equity also requires market research, which includes tracking, exploring change, and/or extending brand power. Tracking makes comparisons among competitive brands or products against a benchmark. Exploring change focuses on how consumers make decisions based on brand.

Understand Customer Brand Attitude. A customer-based perspective in the measurement of brand equity focuses on the experiences that consumers have with a brand. The stronger the brand, the stronger the customer's attitude toward the products or services associated with the brand. When customers experience a product or service, they gauge the overall brand quality and tend to infer certain brand attributes. If these experience measures are positive and endure over time, brand loyalty typically results.

Identify The Brand Equity Components To Measure. Awareness, reach and image association are all aspects of brand equity that may not be closely associated with consumer experience. These measures of brand equity may reflect the impact of traditional advertising campaigns and the influence of social or interactive media.

Measure Perceived Brand Differentiation. Product differentiation is a lynchpin for brand loyalty, confidence in a brand and the potential for brand switching. Customer perceptions about brand differentiation tend to be strongest when an actual product or service experience has occurred, but brand differentiation is not immune to the influence of advertising. Differentiation may float on product or brand recommendations in social media rather than on any personal experiences with a brand. Because differentiation is so susceptible to social influence, it lends itself to measurement across multiple media channels.

Effective measurement of brand equity is critical to the development of brand strategy, which leads to customer engagement and loyalty.

Source: Gigi DeVault is a commercial writer who likes that category because it covers just about every type of writing except maybe writing home.

Compiled by Cassandra Johnson

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