The paper "What Is Brand Equity, Apart From a Reflection of Market Share? " is a brilliant example of coursework on marketing. Brands are a major player in today’ s modern and highly competitive society. Be it any product or service, nothing is recognized without a brand name. Brands penetrate all spheres of our life; be it social, economical, culture, financial, or even religion or sports. We all want to endure products or services that are known and trustworthy. Because of this pervasiveness, they have come under growing criticism (Klein, 1999) Brands are intangible assets that produce added benefits for the growth and profit of the business.
Brand equity is all about the popularity of a product or service with the consumers. Thus brand equity indirectly reflects the market share of a product. For example, if you have gone out to buy a soft drink from the market and you have two options: coca-cola or a brand x, which is not so common. Which one do you think you will go? The power of a Brand Consider brands like GAP, The body shop, IKEA, or Starbucks Coffee What all does these brands provide us? Inclusion of user communities and trust that our particular brand would provide us value for money and serves the higher purpose of social relevance.
Also, most importantly it helps us save us from confusion to go for what and whatnot. The brand gives us a clear choice and does the thinking for us. The value built up in a brand is known as brand equity. Positive reviews and association of consumers to a particular brand defines its brand equity. This signifies that brand equity is directly proportional to its consumer awareness.
The value of a company's brand equity can be calculated by comparing the expected future revenue from the branded product with the expected future revenue from an equivalent non-branded product. Branding has a large effect on the price that customers pay in a market that has similar products. Undoubtedly, brands add value to a service or product. Brand equity describes brands as well as its component value. Brand equity for any product can be viewed from three perspectives: Financial- For example, if consumers are ready to shell out extra dollars to buy a particular brand of mobile phone over another brand, this premium provides information on the power and popularity of a brand that represents its brand equity. Brand extensions-A successful brand provides an easy platform for a company to launch related products.
Leveraging of existing brands help reduce the advertising and marketing expenditure on new brand launched. Further, an appropriate brand extension significantly enhances the core brand. However, the value of brand extension is more difficult to quantify than are direct financial measures of brand equity Consumer-based- Customer’ s attitude strength towards a product associated with a brand is significantly known to improve with a strong brand.
Experience with a product plays a vital role in increasing the attitude strength of customers.