Author Topic: Brand equity  (Read 471 times)

Offline Jeta Majumder

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Brand equity
« on: April 03, 2014, 06:33:06 PM »
Brand equity is a phrase used in the marketing industry which describes the value of having a well-known brand name, based on the idea that the owner of a well-known brand name can generate more money from products with that brand name than from products with a less well known name, as consumers believe that a product with a well-known name is better than products with less well-known names.

Some marketing researchers have concluded that brands are one of the most valuable assets a company has, as brand equity is one of the factors which can increase the financial value of a brand to the brand owner, although not the only one. Elements that can be included in the valuation of brand equity include (but not limited to): changing market share, profit margins, consumer recognition of logos and other visual elements, brand language associations made by consumers, consumers' perceptions of quality and other relevant brand values.

Consumers' knowledge about a brand also governs how manufacturers and advertisers market the brand. Brand equity is created through strategic investments in communication channels and market education and appreciates through economic growth in profit margins, market share, prestige value, and critical associations. Generally, these strategic investments appreciate over time to deliver a return on investment. This is directly related to marketing ROI. Brand equity can also appreciate without strategic direction. A Stockholm University study in 2011 documents the case of Jerusalem's city brand. The city organically developed a brand, which experienced tremendous brand equity appreciation over the course of centuries through non-strategic activities. A booming tourism industry in Jerusalem has been the most evident indicator of a strong ROI.

Brand equity is strategically crucial, but famously difficult to quantify. Many experts have developed tools to analyze this asset, but there is no universally accepted way to measure it. As one of the serial challenges that marketing professionals and academics find with the concept of brand equity, the disconnect between quantitative and qualitative equity values is difficult to reconcile. Quantitative brand equity includes numerical values such as profit margins and market share, but fails to capture qualitative elements such as prestige and associations of interest. Overall, most marketing practitioners take a more qualitative approach to brand equity because of this challenge. In a survey of nearly 200 senior marketing managers, only 26 percent responded that they found the "brand equity" metric very useful.

Offline munna99185

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Re: Brand equity
« Reply #1 on: April 04, 2014, 12:48:07 PM »
The value premium that a company realizes from a product with a recognizable name as compared to its generic equivalent. Companies can create brand equity for their products by making them memorable, easily recognizable and superior in quality and reliability. Mass marketing campaigns can also help to create brand equity. If consumers are willing to pay more for a generic product than for a branded one, however, the brand is said to have negative brand equity. This might happen if a company had a major product recall or caused a widely publicized environmental disaster.
   


Sayed Farrukh Ahmed
Assistant Professor
Faculty of Business & Economics
Daffodil International University

Offline shahanasumi35

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Re: Brand equity
« Reply #2 on: April 09, 2014, 07:37:26 PM »
Nice post.

Offline Jeta Majumder

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Re: Brand equity
« Reply #3 on: April 10, 2014, 11:56:28 AM »
Thank you sir...:)

Offline gour2010

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Re: Brand equity
« Reply #4 on: April 13, 2014, 10:55:35 AM »
Nice post 8)

Offline sajib

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Re: Brand equity
« Reply #5 on: April 16, 2014, 04:32:41 PM »
A brand's power derived from the goodwill and name recognition that it has earned over time, which translates into higher sales volume and higher profit margins against competing brands.

Read more: http://www.businessdictionary.com/definition/brand-equity.html#ixzz2z2lHCG2I
Kamrul Hossain Sajib
Assistant Controller of Examination
Daffodil International University