How to Calculate Brand Equity/Value in Practice




(Customer Based) Brand Equity
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Priyanka B
Manager, India

How to Calculate Brand Equity/Value in Practice

🔥NEW Brand Equity (BEQ) is the added value that a brand delivers to a product or service that goes beyond its functional features. It refers to how consumers see the brand and how that view influences their purchasing behaviour. Increased consumer loyalty, higher prices, and a more favourable response to marketing and advertising can all arise from respectable BEQ.

Brand Value Models

There are several classic models for measuring the value of a brand, including:

  • Keller's Brand Equity Model: The Keller Brand Model defines BEQ as the added value a brand brings to a product, based on how consumers perceive the brand's ability to provide quality, reliability, and unique features. In other words, the value a brand brings to a product is decided by consumers' opinions about the brand's capacity to deliver high-quality, trustworthy products with unique attributes.
  • Aaker's Model: According to the Aaker Model, BEQ is the value that a brand gives to a product or service through a mix of brand loyalty, brand awareness, perceived quality, and other brand associations. Simply said, the value of a brand is defined by how well-known it is, how well customers perceive it, and how likely consumers are to be loyal to the brand.
  • Brand Asset Valuator (BAV): BAV is a model developed by Young & Rubicam that measures brand strength along four dimensions: differentiation, relevance, esteem, and knowledge.
  • BrandZ: BrandZ is a model developed by Kantar Millward Brown that measures brand value based on financial metrics and consumer research.
  • Interbrand Methodology: Interbrand is a model that measures brand value based on financial metrics, market analysis, and consumer research.
  • Customer-Based Brand Equity (CBBE) Model: The CBBE model was developed by Kevin Lane Keller and focuses on the relationship between the brand and the consumer, measuring BEQ along four dimensions: brand salience, brand performance, brand imagery, and brand feelings.

  • Calculating/Measuring Brand Equity

    Each model offers a unique viewpoint on how to calculate BEQ and can be used in tandem to gain a more comprehensive picture of a brand's worth.

    To begin, any organization can use the following three basic approaches to understand BEQ:
    • Social Media Analysis: Monitoring social media can help businesses track consumer sentiment and identify areas for improvement. It provides insight into consumer opinions and helps maintain market competitiveness by tracking what's being said about the brand and its competitors.
    • Brand Recognition: Measuring brand recognition through surveys or market research to determine the extent to which consumers are familiar with the brand. A few ways are:
      • Brand Awareness Surveys: Surveys that ask consumers about their familiarity with a brand.
      • Unaided Awareness Measurement: Asking consumers if they can name a brand in a particular category without any prompts or reminders.
      • Aided Awareness Measurement: Providing consumers with a list of brand names and asking them to select the brands they recognize.
    • Brand Associations: The emotional and functional associations consumers have with a brand can impact brand loyalty and market success. Emotional associations include feelings of trust, confidence, and pride, while functional associations include quality, value, and dependability. A strong emotional connection and functional association can lead to an increase.
    ⇨ Please share your practical tips or experiences in calculating the equity of a brand. Thanks! 8-3-2023
     

    Rating

     
    1
    Paramathmuni srinivas Kumar
    India
     

    Calculating the Equity of Brand

    Brand associations has emotional and functional associations with consumers have can impact brand lo... Sign up 10-3-2023

     
    0
    salifu akoh PhD, FCNA, CCrFA
    Accountant, Nigeria
     

    Brand Awareness Survey in Nigeria

    Brand recognition especially the aided awareness measurements holds sway in Nigeria where there is a... Sign up 11-3-2023

     
    3
    Jaap de Jonge
    Editor, Netherlands
     

    Why Calculating Brand Equity Exactly is not Possible

    Measuring or calculating brand value and/or equity is quite similar to how people are determining th... Sign up 13-3-2023

     
    1
    salifu akoh PhD, FCNA, CCrFA
    Accountant, Nigeria
     

    Determination of Brand Equity

    @Jaap de Jonge: Most brand valuation concepts are based on non-financial information and asymmetry o... Sign up 13-3-2023

     
    1
    Warren D. Miller, CPA, CFA
    Strategy Consultant, United States
     

    Valuing Brand Equity, Though Subjective, is Useful, Nonetheless

    @Jaap de Jonge: Your comments are well-taken, Jaap. Thank you. That said, though, I think it's wort... Sign up 14-3-2023

     
    1
    Maurice Hogarth
    Consultant, United Kingdom
     

    The Intangible 'like' and 'dislike'

    @Jaap de Jonge: Agreed. Many, many moons ago I was working with someone who applied, with his wife,... Sign up 16-3-2023

     
    0
    Warren D. Miller, CPA, CFA
    Strategy Consultant, United States
     

    More on 'Intangible Like and Dislike'

    @Maurice Hogarth: That's a terrific post, Maurice - spot-on. While it won't work in purchase-price a... Sign up 16-3-2023

       

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