What Is Brand And Its Importance

Posted by Ayatas Technologies on September 23rd, 2022

Today more than ever, brands face the challenge of capturing and maintaining their market share and retaining customers. That is why we will learn what brand value is today and the importance of building and managing it in the long term. Brand equity is a multidimensional and complex concept, but understanding it remains essential for a brand to develop its competitive potential. Let's learn more about this concept and why is branding important for your businesses, and how it contributes to the success of your company.

What is brand equity?

Brand value or brand equity refers to the degree of consumers' familiarity with your company and brand. When it comes to promoting your products and services is one of the first important steps you should tackle. It is a concept that tries to explain and quantify the fact that consumers respond better to marketing campaigns for a product or service of a certain brand than another. From the consumer's point of view, a brand's value is the sum of the positive and negative associations with a brand. From the organization's point of view: Value is the consumer's perspective perceived as an intangible asset on the bottom line.

What are the components of brand equity?

For some specialists, the brand's value comprises certain elements, including brand loyalty, awareness, perceived quality, brand association, and other proprietary assets.

1. Brand Loyalty

Brand loyalty dictates that a consumer who truly believes in the value of a brand's offerings is likely to make frequent, repeat purchases from that brand rather than switch brands. High brand loyalty ensures that the business is stable and consistent, allowing the organization to capture a larger market share.

2. Brand Awareness

Brand awareness refers to the degree to which a brand is known or recognizable to a consumer. A brand with a high value will come to mind when a customer is looking for a particular product.

3. Perceived quality

This element focuses on the brand's reputation for high-quality products and customer experience. Good quality is valued more than product features, and consumers are often willing to pay more for high-quality products than other brands.

4. Brand Association

Brand association implies anything related to the brand that evokes positive or negative feelings, for example, the functional, social, or emotional benefits of a product. More broadly, this relates to the overall brand image and what consumers associate with that image: if consumers predominantly associate positive attributes with the brand, then the brand possesses high brand equity.

5. Other own assets

Assets include patents, trademarks, and channel or business partner relationships. These assets are vital to ensuring that other brands cannot compete by operating under a similar name or using very similar packaging, which can confuse consumers and compete with a brand's customer base.