A Case Study On Brand Equity Marketing Essay

A Case Study On Brand Equity Marketing Essay Brand equity can be viewed both as an intangible or tangible asset and or liability. The tangible being the monetary value of a brand and best viewed as the amount of additional income expected from a branded product over and above what might be expected from an identical, but unbranded product. To best illustrate this point would be a supermarket, they frequently sell unbranded versions of name brand products. The branded and unbranded products are produced by the same companies, but they carry a generic brand or store brand label like No Name or Home brand. Store brands sell for significantly less than their name brand counterparts, even when the contents are identical. This price difference is the monetary value of the brand name. However, according to (Aaker,1996) the most important assets of any business are intangible: its company name, brand, symbols, and slogans, and their underlying associations, perceived quality, name awareness, customer base, and proprietary resources su ch as patents, trademarks, and channel relationships. The intangible value associated with a product that can not be accounted for by price or features is illustrated by globally renowned company Nike. I has created many intangible benefits for their athletic products by associating them with star athletes. Children and adults want to wear Nike’s products to feel some association with these star athletes (â€Å"be like Mike.† ) The marketing image that has been created for Nike is the driving force of the demand for the products rather than the physical features. Buyers are willing to pay extremely high price premiums over lesser known brands which may offer the same, or better, product quality and features. Ideally brand equity is a set of assets (and liabilities) linked to a brand’s name and symbol that adds to (or subtracts from) the value provided by a product or service to a firm and/or that firm’s customers.(Aaker,1996) These assets, which comprise brand equity, are a primary source of competitive advantage and future earnings. (Aaker, 1996) The overall description of Brand Equity incorporates the ability to provide added value to company’s products and services. This added value can be an advantage to charge price premiums, lower marketing costs and offer greater opportunities for customer purchase The assets/ advantages of brand equity: Allows you to charge a price premium compared to competitors with less brand equity. Strong brand names simplify the decision process for low-cost and non-essential products. Brand name can give comfort to buyers unsure of their decision by reducing their perceived risk. Maintain higher awareness of your products. Use as leverage when introducing new products. Often interpreted as an indicator of quality. High Brand Equity makes sure your products are included in most consumers consideration set. Your brand can be linked to a quality image that buyers want to be associated with. Offer a strong defense against new products and new competitors. Can lead to higher rates of product trial and repeat purchasing due to buyers’ awareness of your brand, approval of its image/reputation and trust in its quality.