What is Brand Equity? Definition

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What is Brand Equity? Definition
Andoh, Member
What is brand equity and what is the strategic importance of brands to an organisation in terms of brand equity?

What is Brand Equity?
Ravi Kumar, Member
Brand Equity refers to the value of a brand. Brand equity is based on the extent to which the brand has high brand loyalty, name awareness, perceived quality and strong product associations. Brand equity also includes other Intangible Assets such as patents, trademarks and channel relationships.

Brand Equity Components
Brand Equity includes:
- Brand Value
- Brand Loyalty
- Brand Awareness / Recognition
- Brand Image / Personality
- and perceived services and products.

Brand Equity
ademola akinbola, Member
Brand equity components encompass all that the previous contributors have mentioned. But, the most important index of brand equity is value creation, that is the ability of the brand to create value consistently.

Definition of Brand Equity
Brand equity is the value that is the result from the faith that the customers have in the promises the brand makes to them and fulfills.
For maintaining the same the owner of the brand needs to continuously monitor the performance and expectations.

Brand: the Hidden Assets of Business
M.A Jama, Member
A company's brand is not its name, logo or websites, but rather the perception that clients, investors, employees and members of the general public have of the company. In other words the reputation of the company makes up the company's brand and therefore denotes the value of its brand equity. Often companies do not realize the value of the wealth in their brands created by their marketing department or outsourced agency, and their brands can be considerable asset once it appears on their balance sheet. while brand equity is not the only factor to possibly increase the financial value of a brand to the brand owner, it is a noteworthy and valuable one.

Apart from a brand's language associations made by consumers, and consumers perceptions of quality, other elements that can be included in valuation of brand equity are changing market share, profit margins, consumer logos and other visual elements. a practical example that i have chosen to explain such value of brands is Coca Cola brand which have been valued over billions of dollars and the company may incorporate this value in their balance sheet as intangible asset. Brands lead to two issues, firstly, companies forget to register what could be their most important asset: that is their trade mark or brand and think that by registering the domain(co.za) name or the company name(pty ltd) they have blocked the registers. Trade mark registration is not far better but also far stronger. Trade marks are registered in terms of the Trade Mark Act of 1993.

The benefit of obtaining a trade mark registration include that: its serves to block the trade marks registers; a trade mark is often a useful tool in objecting to company names or domain name registrations which may be fairly similar; more importantly a trade mark registration affords a statutory rights which enables the registered proprietor to sue certain parties for infringement of the use of confusingly similar trade marks.
The second issue involves the value of a companies trade mark. The South African Revenue Services has been known to question a company which includes a trade mark value on its balance sheet when the company have not registered the trade mark. In other words South African Revenue Services attitude may possibly be to allocate the value to goodwill as opposed to trade mark asset value, as they would ask the question: If this trade mark is so important why did you never register it?

When it comes to valuation, there are different methods which can be used, perhaps the most frequently used one is Discounted Cash Flow. the other one may be Earnings Before Interest, Tax and Depreciation, as well as recurring fee income, which is often used by insurance companies. there is another important method which is Royalty Relief. This method is a business leasing out its trade mark to a third party which will therefore pay a royalty for such use. Which ever method is used, the wise practice is to adopt a cautions or conservative approach, because rather flamboyant approach may result in objections made by SARS officials or shareholders of the company.

What is Brand Equity?
Alireza, Member
'Brand Equity', I think is the situation and extent to which "the consumers love your brand".
When everyone loves you, they accept all conditions. They believe your brand, don't ask for the price, term of sale, don't want to know about materials of product, etc. And they will be your customer for a long time.

Four Dimensions of Brand Equity (Buil and Martinez)
Anneke Zwart, Moderator
In an article “The Influence of Brand Equity on Consumer Responses, Buil and Martinez (2013) investigate the influence of consumer-based brand equity on consumer’s responses. In order to do this, they firstly discuss the term BRAND EQUITY. It turns out there are four dimensions of brand equity, which according to the authors are well known and widely accepted and therefor useful for research to brand equity:
1. Brand Awareness: Consumers firstly need to be aware of a certain brand in order make associations later on. Brand awareness refers to the degree of recognition and remembering a certain brand and is therefore related to the power of a certain brand in consumers’ mind. The process of brand awareness also involves the process of associating the brand with past experiences or other things in memory.
2. Perceived Quality: Perceived quality is an attitude towards a certain brand; it refers to the perception of a product/service overall quality and relative power to other products/services.
3. Brand Associations: This also is an attitude toward a brand, but it refers to the concepts that are related to the name of the brand in one’s mind/ memory.
4. Brand Loyalty: Brand loyalty refers to the level of commitment towards a certain brand. The more positive the perception of a brand is, the higher brand loyalty will be. According to the authors' hypothesis and past research, perceived quality and brand associations are both antecedents of brand loyalty and are positively related to it (Keller and Lehman, 2003; Pike et al, 2010)
Buil, I. and E. Martinez (2013) “ The Influence of Brand Equity on Consumer Responses” Journal of Consumer Marketing Vol. 30 Iss.1 pp. 62-74
Keller, K.L. and Lehmann, D.R. (2003) “How do Brands Create Value?” Marketing Management
Pike, S., Bianchi, C., Kerr, G. and Patti, C. (2010) ““Consumer-based Brand Equity for Australia as a Longhaul Tourism Destination in an Emerging Market” International Marketing Review, Vol. 27 No. 4 pp. 434-49


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