Brand Equity

Topics: Brand, Brand management, Marketing Pages: 4 (1278 words) Published: January 14, 2013
Brand equity 
Brand equityis a phraseused in the marketing industry which describe the value of having a well-known brand name, based on the idea that the owner of a well-known brand name can generate more money from products with that brand name than from products with a less well known name, as consumers believe that a product with a well-known name is better than products with less well known names.[1][2][3][4] Another word for "brand equity" is "brand value". Some marketing researchers have concluded that brands are one of the most valuable assets a company has,[5] as brand equity is one of the factors which can increase the financial value of a brand to the brand owner, although not the only one.[6] Elements that can be included in the valuation of brand equity include (but not limited to): changing market share, profit margins, consumer recognition of logos and other visual elements, brand language associations made by consumers, consumers' perceptions of quality and other relevant brand values. Consumers' knowledge about a brand also governs how manufacturers and advertisers market the brand.[7][8] Brand equity is created through strategicinvestments in communication channels and marketeducation and appreciates through economic growth in profit margins, market share, prestige value, and critical associations[disambiguation needed]. Generally, these strategicinvestments appreciate over time to deliver a return on investment. This is directly related to marketing ROI. Brand equity can also appreciate without strategic direction. A Stockholm University study in 2011 documents the case of Jerusalem's citybrand.[9] The city organically developed a brand, which experienced tremendous brand equity appreciation over the course of centuries through non-strategic activities. A booming tourism industry in Jerusalem has been the most evidentindicator of a strong ROI. Brand equity is strategically crucial, but famously difficult to quantify. Many experts have...
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