Dec 02 — Written By: Andy Quella

The Importance Of Brand Equity In Commercial Dynamics

Building brand equity is the process of enhancing the value and strength of a brand over a certain period of time. It involves developing positive associations, perceptions, and emotional sentiment by crafting user-friendly experiences that resonate with a particular audience or market segment. In other words, brand equity is the value that stems from the perception of the unique experience, as opposed to the tangible product or service. The process should be regarded as a long-term investment rather than a short-term expense.

Developing an effective identity system requires a detailed analysis of the brand ethos or essence of the brand. What purpose does the brand serve? What principles and values does it prioritize? Defining these elements will serve as the foundation upon which the entire identity is built. It's the DNA that shapes how a brand presents itself and connects with the end user. By weaving the brand ethos into every aspect of the design process, companies can enhance perception and maintain a consistent narrative across touchpoints.

Brand Awareness

At the heart of brand equity exists awareness. You see a logo, hear a jingle, or pass by a digital billboard. It's the most basic level of recognition. Awareness enables individuals to identify a specific brand before making a purchase decision. If nobody knows your brand exists, they are unable to form positive associations or loyalty. The concept of brand equity, however, goes much deeper. While brand awareness is like meeting someone for the first time, brand equity refers to the relationship you build from the experiences you share. It's the total value of the brand.

Brand Perception

How your brand is perceived can shape future interactions and influence decision making. It encompasses more than just aesthetics—it defines the emotional connection between a brand and the target audience. By exploring how we process information and make decisions, we can design products that are more effective and user-friendly. From color and typography to visual hierarchy, each element of the identity system should work to elicit an emotional response. The objective is to connect positive feelings and emotions to encourage a desired action or business result.

Brand Association

Brand association refers to the connection or perception an individual may develop when interacting with a brand. Associations can be consciously or subconsciously surfaced through related experiences including impactful storytelling, product interactions, and word-of-mouth. Emotional sentiment is the link between a brand and its desired associations. For example, if an athletic apparel company makes customers feel confident and empowered during a workout, the positive sentiment will reinforce brand association with concepts like performance and self-improvement.

Brand Consideration

Brand consideration is the extent to which users are willing to consider a product or service before making a purchase decision. Understanding preference and engagement patterns is essential to elicit an emotional response as individuals perform research and consider alternative solutions. Driving consideration is often a more targeted effort that requires psychographic or behavioral segmentation to influence decision making. Optimizing the user experience with personalized content and recommendations can connect the brand to subconscious desires and motivations that impact consideration.

Brand Loyalty

Loyalty is a powerful asset. It goes beyond just repeat purchases, encapsulating a deeper emotional connection with the brand. Loyal customers actively choose a particular product over competitors and recommend it to others in their network. They are familiar with the offering and trust the quality, reliability, and service. Loyalty plays a crucial role in building and strengthening brand equity. It contributes to long-term sustainability and growth. By nurturing strong relationships and delivering consistent value, brands can enhance loyalty and establish a reliable position in the market.

Conclusion

The brand is ultimately a complex pattern of associations, etched into the mind of the market over countless exposures.^[1] When users encounter these elements on a recurring basis and the experience is favorable—trust forms and recognition builds. This is why brand equity is so important. A set of organizing principles that define the brand to cultivate perception and engagement. It's the consistent theme sourced from the digital strategy that fuels performance. Each touchpoint is a valuable opportunity to inspire curiosity and communicate purpose.

Measuring brand equity requires a combination of qualitative and quantitative methods including in-market surveys, focus groups, and actively monitoring unaided awareness, market share percentage, and net promoter score (NPS). Ask questions about how customers perceive your brand and the type of feeling it evokes. Understanding and prioritizing brand equity becomes not just a choice but a necessity. It represents the intangible essence that elevates a brand beyond a simple product or service into a fundamental component of culture and human nature.