Brand equity is essential for survival and success in an age where brands are vying for consumer attention across myriad digital and physical landscapes. Like how a person’s reputation often precedes them, brand equity is an invaluable aura surrounding a company’s name.
According to a recent study, 81% of consumers need to trust a brand to consider buying, and 77% prefer shopping with brands they follow on social media. And that’s not all: 55% of brand first impressions are visual, and according to Salesforce, 94% of marketers believe that personalised marketing positively affects brand-building.
Below, we’re delving deeper into the nuances of brand equity, and explain how to build yours.
What Is Brand Equity?
Before we discuss building brand equity for your business, let’s explain what brand equity is.
In simple terms, it’s the perceived value of your brand, separate from the products or services you offer. Imagine brand equity as a financial bank; the more deposits of good reputation and customer experience you make, the more robust your brand becomes.
Conversely, withdrawals through negative experiences or false promises weaken the brand’s value.
Brands like Harrods and Fortnum & Mason demonstrate high brand equity.
They can charge a premium not necessarily because their products are superior but due to the perception of superiority. This public sentiment is precisely what cheaper, knock-off brands try to emulate, albeit usually less successfully.
And this doesn’t just apply to premium brands. Just look at the success of the recent collaboration between Greggs and Primark in the UK, and the work KFC is doing by collaborating with other brands to build its own presence and change public perception.
What Builds Brand Equity?
Success isn’t just about having a catchy name or logo; it’s about authenticity and delivering on promises. We’ve put together a few vital strategies to build brand equity:
Create a Brand Messaging Framework
Before considering advertising, your brand’s messaging must be clear, compelling, and consistent.
This messaging underpins all consumer interactions and creates the foundation of brand equity.
Apply Keller’s Brand Equity Model
Developed by marketing professor Kevin Lane Keller, this model outlines the steps towards building brand equity.
It focuses on brand identity, meaning, response, and resonance, offering a roadmap for companies to follow.
Invest in Customer Experience
One negative experience can result in not just the loss of a customer but also the spreading of negative word-of-mouth.
After all, reviews and testimonials can make or break a business; no amount of brand-building will change that.
86% of the time, good customer service turns a one-time client into a loyal brand advocate (data from Khoros). What’s more, 83% of customers say they feel more loyal to a brand that has resolved an issue or complaint – get this right, and you’ll be a winner in no time.
Types of Brand Equity
1. Brand Identity
The first step towards building brand equity is understanding your brand’s identity. This identity combines your values, promises, and overall brand personality. Exploring brand archetypes can be invaluable in this phase, helping clarify what you want your brand to symbolise.
2. Brand Awareness
This type of equity is all about brand salience, a measure of how often and how easily your brand comes to mind when a customer is in a buying mood. Understanding psychology is critical here; humans easily recall what is emotionally meaningful, highly relevant, and visually striking. Thus, your marketing campaigns must blend emotion, personal relevance, and striking visuals to build strong brand awareness.
3. Brand Loyalty
This is the fortress that defends you from competitors. A loyal customer won’t jump ship if a rival brand offers a discount. Building brand loyalty goes beyond offering better discounts; it’s about offering a unique value proposition that resonates deeply with the consumer. Studies have shown that nearly 68% of Honda customers plan to buy another Honda, owing to its affordability, safety, and reliability.
Building brand equity is not a one-time effort; it’s a continual process that evolves with market trends and consumer behaviour.
However, brands that build equity enjoy numerous benefits, including customer loyalty, the ability to charge premium prices, and resilience against negative publicity.
In the digital age, where consumers are not merely recipients but also sharers of brand messages, building brand equity becomes more than just a marketing strategy—it becomes a matter of corporate survival. With strategies like honing brand messaging, investing in customer experience, and understanding the different facets of brand equity, companies can pave the way for long-term success.
If you’re looking for support building yours, contact the digital transformation experts at Zudu today.