All you need to know about branding equity today

All you need to know about branding equity today

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All you need to know about branding equity today

by Ashwin Mason
in Software Review

1. What branding equity is

Branding equity is the value of branding that results in tangible and intangible benefits to your organization. The most important word here is intangible . There are very few branding issues that result in clear-cut monetary advantages, but there are many branding issues that can make or break a brand's success (in other words, help or hinder the brand from achieving its goal).

2. Why branding equity matters

Branding equity matters because branding is one of the most important factors in evaluating the value and health of your organization. Branding helps determine customer perceptions, which can be influenced by branding decisions as well as non-branding decisions (such as product quality). If branding were all branding did, branding equity would not matter much. However, branding also affects key performance indicators such as revenue and profitability.

3. How branding equity can be created and maintained  

Brand equity can be created and maintained in a number of ways. As branding decisions are made, branding can be used to enhance the value of an organization. Some branding equity is created when branding decisions enhance product quality or customer perceptions about a brand.

The following are six branding methods for creating and maintaining branding equity:

  1. Forming and activating a strong identity;
  2. Driving awareness;
  3. Developing multiple touchpoints;
  4. Building relationships with customers;
  5. Differentiating products/services through branding; and
  6. Creating consistent experiences across all channels.

Implementing any one of these branding methods will not guarantee your success, nor will adopting all of them. It depends on how you use branding as well as what type of branding method you choose to implement in your branding strategy.

Invest in branding equity by implementing branding strategies that will capture customer attention and increase the value of your company through branding.

4. The importance of branding equity for small businesses in the digital age

The digital age involves the branding of everything – from restaurants to apps. As branding multiplies across all channels and media, branding decisions become even more important than ever before. It is much easier today to research brands online. Every branding decision can be scrutinized by a huge number of potential customers who have access to better information about your brand (and your competitors) that you might have about them.

Brand equity has been made more prominent because branding strategies are no longer limited to product lines; they can now involve social responsibility, corporate citizenship and the like. In this way, we see branding carrying over into non-profit branding as well as business branding in sectors such as banking or home improvement where corporations want to build their own.

5. Examples of brands that have done a good job with branding to create brand equity, including Nike, Starbucks, and Coca-Cola

A number of branding examples can be found that illustrate the branding methods mentioned earlier.  Some of them are quite surprising – for example, pick-up trucks have branding equity. On this note, Coca-Cola and Starbucks are good examples to use because their branding strategies differ yet both ended up creating strong brands with high levels of branding equity.

If you were to look at a brand such as Coca-Cola (from a branding perspective), you would find that the core of its branding strategy is building relationships with customers by differentiating itself through branding. The company has succeeded in building a recognizable identity which provides consumers with unique associations and feelings toward the brand. They also differentiate themselves across all channels (with consistency) so that they build relationships with customers. They have created a branding experience that is memorable (to the point of being iconic), and this branding has been highly effective in creating branding equity and value for the Coca-Cola brand.

In contrast, Starbucks is an example of branding leveraging corporate social responsibility to create branding equity and value. It has activated a strong identity with consistent branding across all channels that builds a unique relationship with its customers while also delivering high levels of customer satisfaction through excellent customer service/retention, which leads to increased revenue and profitability (bottom line).  Starbucks brings people together and acts as a catalyst for community building – as one example, they are constantly looking for ways to engage citizens through their “social action program” called "Bean Stock", which raises money for local communities.

In branding, branding equity is perhaps the most important factor in building a valuable and profitable brand. By leveraging branding equity to build strong brands, you are tapping into the fundamental “branding currency” that will make your branding efforts successful.

Powerful branding strategies have been used by many successful companies today, such as Nike – because of their branding success these brands have created significant branding value (and continue to do so), and it is this branding value that allows them to grow and expand as well as create new products/brands within their own product/service lines.

It is sometimes seen as a very simple task, but branding is not easy – there are many different aspects in branding (and branding strategies) that must be considered when creating a brand. Successful branding brings value to your brand – one example of this being Nike’s “Just Do It” motto, which played a major role in transforming the company from small sports apparel/shoe maker to a major athletic wear manufacturer.

6. Examples of brands that have done a bad job with branding to create brand equity

- BP

- British Petroleum

These are companies that have done branding the “wrong way” and therefore they have not created branding value or branding equity.  BP is a perfect example of a company with branding issues – branding to create value must be done carefully, and using people's emotions can make branding highly effective, but in this case it backfired on them. They went through an oil spill at their Deepwater Horizon well site which resulted in major negative branding for the company (and all of its subsequent brands).


Brand equity is an important branding strategy that can help you stand out in the competitive marketplace. When branding to create value, it's vital not only to consider how consumers react emotionally, but also what they respond positively too (such as Nike). Successful branding creates a strong consumer relationship with your company and product line by differentiating yourself from other companies in the same industry.

It's possible for even small businesses without much marketing experience or budget to develop successful branding strategies – so don't be afraid of trying! Just remember, branding takes time and effort; if you want brand equity then make sure you're willing to commit those precious resources into building your brands' reputation and if you like to build your brand download this worksheet:- Click here

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Article by
Ashwin Mason
I review the best software for freelance designers, photographers, and developers to run their businesses and hire the most appropriate freelancers for your project.
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