How To Build Brand Equity That Influences (9-Step Framework)

Brand equity is the influence a brand has over its market to choose it over its competitors. 

The influence is quantifiable in brand equity, an intangible asset that increases the value of a brand beyond its physical assets.

For example, if you stripped Nike of all its stores, factories, and products, it would still hold a value that investors would be prepared to pay for. That value is the willingness of the market to choose it over its competitors.

So now you know what brand equity is, let’s find out how to go about creating such an asset.

In this guide, I’ll break down a 9-step framework that will help you not just build brand equity but nurture it for long-term growth. From actionable strategies to insightful tips, you’ll gain a new understanding of how to create a brand that resonates and ends.

What Is Brand Equity?

Smiling woman unboxing

Brand equity refers to the value a brand adds to a company through its reputation, perception, and customer loyalty. 

It’s the intangible asset that differentiates a brand’s products from those of its competitors, creating a unique identity in the minds of consumers

This value manifests in various forms, including brand loyalty, perceived quality, and brand associations, all of which contribute to the overall brand identity.

Negative brand equity results from poor customer experiences, inconsistent branding, or unethical practices, leading to a damaged reputation and loss of customer trust. 

For instance, a brand that fails to deliver on its promises or engages in misleading advertising can quickly erode the positive associations it once enjoyed.

Therefore, managing brand equity is crucial for maintaining a favorable brand image and making sure of long-term success. Brand equity is vital for achieving these goals.

What Is The Brand Equity Pyramid

Paper cups stack on pyramids

Keller’s Brand Equity Pyramid, also known as the Customer-Based Brand Equity Model, provides a structured approach to understanding and building brand equity.

 This model is depicted as a pyramid with four levels:

Brand identity

Brand meaning

Brand response

Brand resonance

Understanding these levels is essential for establishing a solid foundation for brand equity.

Brand Identity

Male designer infront of his computer, designing logo

At the base of the pyramid is brand identity, which is crucial for creating a foundation of brand awareness. 

This stage isn't just about designing a logo or choosing a name—it's about making sure that your brand is easily recognizable and stands out in a crowded market. 

You want consumers to recall your brand when they’re making purchasing decisions. 

The goal is not just visibility but also making sure your brand is associated with specific qualities or values. 

Brand Meaning

Owner and customer interaction

The next level is brand meaning, where your brand goes beyond being recognized and begins to resonate with why it matters. 

This stage is about how well your brand delivers on its promises—its performance—and how it’s perceived by consumers. Here, you're shaping not only the practical, functional benefits of your product or service but also its social meaning. 

Does your brand align with your customers’ values? Is it something they’d feel proud to associate with in public? 

Strong brand meaning leads to emotional connections and social relevance, which are crucial to long-term customer relationships.

Brand Response

Moving up, brand response focuses on how your consumers feel about your brand and how they judge its quality and relevance.

It’s not enough for consumers to be aware of your brand; they need to have positive reactions toward it.

This stage is about managing consumer perception—whether it’s making sure that consumers view your brand as reliable, innovative, or trustworthy.

You need to evaluate what judgments your audience is making, consciously or subconsciously, and make sure you’re fostering positive emotional connections that lead to repeat purchases.

Brand Resonance

a woman asking about a product

At the pinnacle of the pyramid is brand resonance, where the ultimate goal of any brand strategy is achieved: deep psychological bonds with your customers. 

Here, your customers aren't just buyers—they’re loyal advocates who actively recommend your brand to others and stick with it over time, even when faced with alternatives. 

Resonance involves creating brand communities, fostering engagement, and delivering experiences that turn customers into lifelong fans. 

It’s about building loyalty that withstands competitors' temptations and creating a sense of belonging that makes customers feel like they’re part of something bigger

The Four Types of Brand Equity

Happy answering call from customer from customer service

Brand equity can be categorized into four types brand loyalty, brand awareness, perceived quality, and brand associations. Each type plays a crucial role in defining the overall value of a brand.

Brand Loyalty

Let’s be real, brand loyalty is every company’s dream, right? 

When customers keep coming back, it’s a win-win. Think about your favorite coffee shop—odds are, you’re a regular for a reason. Loyal customers are gold because they’re not just buying; they’re advocating. 

They tell their friends, write positive reviews, and don’t jump ship when a shiny new competitor comes along. 

So, if you’ve got that kind of loyalty, you’re already ahead of the game. 

Brand Awareness

Influencer creating videos for social media

Ever wonder why you always think of certain brands when you’re ready to buy? 

That’s brand awareness doing its magic. Brand awareness is a crucial factor in the success of businesses, influencing consumer behavior and driving sales. 

According to Contently, approximately 61% of consumers are more likely to purchase from a brand they recognize, which is a result of brand awareness.

If people don’t know who you are, they’re not going to buy from you—it’s that simple. So, building brand awareness is all about getting your name out there and sticking in people’s minds. 

Whether through catchy ads or a memorable logo, you want consumers to think of you first. Imagine seeing your brand at the top of everyone’s list.

Perceived Quality

Perception is everything, especially when it comes to perceived quality. 

Even if you’ve got the best product in the world, if consumers don’t believe it’s high-quality, it won’t fly off the shelves. 

Think about it—when you pay extra for a luxury brand, it’s not just about the product itself, but what you think it represents: durability, style, and trustworthiness. 

High perceived quality not only boosts sales but also allows you to charge a premium. It’s like the difference between a fast-food burger and a gourmet one—same ingredients, totally different vibe.

Brand Associations

Man selecting product

We’ve all got brands that just feel right, don’t we? 

That’s thanks to brand associations—those mental and emotional links we make with a brand. Whether it’s a brand’s values, personality, or even the way it makes us feel, these connections are powerful. 

Ever choose one product over another because it feels like a better reflection of who you are? That’s what great brand associations do—they make consumers feel connected on a deeper level. 

And let’s be honest, that’s what keeps people coming back, time and time again.

How to Build Brand Equity

Building brand equity is a strategic effort that requires consistency and alignment across various brand touchpoints. The following 9-step framework provides a comprehensive approach to creating and sustaining brand equity.

Focusing on brand loyalty, awareness, perceived quality, emotional connections, and trust helps companies build a strong and reputable brand that resonates with consumers.

Step 1 – Build Brand Loyalty

Brand loyalty is the cornerstone of strong brand equity. A customer-centric approach, coupled with effective loyalty programs, can foster long-term relationships and encourage repeat purchases.

Providing exceptional customer service is key to building brand loyalty. Companies should prioritize long-term relationships over short-term gains by addressing customer needs and exceeding their expectations.

This approach not only enhances customer satisfaction but also fosters a sense of trust and loyalty.

Loyalty programs are another effective strategy for retaining existing customers and encouraging repeat purchases. Offering special discounts, rewards, or exclusive access to loyal customers creates a sense of exclusivity and appreciation. These programs also provide valuable data on customer preferences and behaviors, enabling companies to tailor their offerings and improve customer experience.

Step 2 – Increase Brand Awareness

Increasing brand awareness is crucial for creating a strong brand presence and attracting new customers. Targeted campaigns and partnerships can significantly enhance visibility and recognition in the market.

Social media campaigns are a powerful tool for building brand awareness. Platforms like Instagram, Facebook, and LinkedIn offer opportunities to engage with a wide audience and showcase the brand’s personality and values.

Regular posts, stories, and interactive content can keep the brand top-of-mind for consumers.

Partnerships and collaborations with influencers or other brands can also expand reach and introduce the brand to new audiences. These partnerships can create positive brand associations and enhance credibility. Additionally, investing in digital advertising can increase visibility and target specific demographics effectively.

Step 3 – Improve Perceived Quality

zappos customer service

Perceived quality is a critical component of brand equity. Making sure product excellence and actively seeking customer feedback can reinforce a brand’s commitment to quality. Maintaining high standards of product quality is essential for building and sustaining perceived quality.

Companies should focus on consistency and innovation to meet or exceed customer expectations. 

This involves regular quality checks, continuous improvement, and staying ahead of industry trends. Listening to customer feedback and making improvements based on their input is another important strategy.

By addressing customer concerns and incorporating their suggestions, companies can demonstrate their dedication to customer satisfaction and quality.

Step 4 – Build Emotional Connections with Customers

Building emotional connections with customers can lead to stronger loyalty and advocacy. Storytelling and purpose-driven marketing are effective ways to create these bonds. Emotional connections matter because they lead to deeper customer loyalty and brand advocacy. 

When customers feel emotionally connected to a brand, they are more likely to remain loyal and recommend the brand to others.

This emotional bond can be a significant differentiator in a competitive market. Storytelling is a powerful tool for creating emotional connections. Sharing the brand’s journey, values, and mission helps resonate with customers on a personal level.

Purpose-driven marketing, such as supporting social causes or environmental sustainability, can further strengthen these emotional bonds. Brands like TOMS Shoes have successfully used storytelling and purpose-driven marketing to build strong emotional connections with their customers.

Step 5 – Create Strong Brand Associations

Creating strong brand associations involves linking your brand with positive emotions, values, and experiences. This can be achieved through emotional storytelling and aligning the brand with causes that resonate with your target market.

Emotional storytelling helps in creating a memorable and relatable brand image. Sharing stories that highlight the brand’s values, mission, and impact forges a deeper connection with consumers. 

Additionally, aligning the brand with values or causes that matter to your audience, such as sustainability or innovation, can enhance brand associations and strengthen brand equity.

Step 6 – Positioning Your Brand in the Market

Beautiful young woman helping to choose clothes to her customer

Effective brand positioning is about identifying what makes your brand unique and communicating that consistently to your target audience. This involves defining your unique value propositions and making sure consistent messaging across all channels.

Identifying unique value propositions requires a deep understanding of what sets your brand apart in the competitive landscape. 

Once these unique aspects are identified, it’s crucial to consistently communicate them through all brand touchpoints, making sure that the brand message aligns with the perception you want to create.

Step 7 – Align with Consumer Expectations

Aligning your brand with consumer expectations involves understanding and adapting to the needs and preferences of your target market. This can be achieved through customer data analysis and adapting your brand messaging accordingly.

Using customer data and insights helps in understanding what your target market values and expects from your brand.

Adapting brand messaging and offers to meet these needs and desires makes sure that your brand remains relevant and resonates with consumers. Companies like Amazon excel at aligning their services based on customer feedback and preferences.

Step 8 – Brand Consistency Across Channels

man assisting customer inquiries

Maintaining brand consistency across all channels is crucial for reinforcing brand recognition and brand trust. This involves making sure unified messaging and a consistent visual identity.

Unified brand messaging means that all communications, whether through email, social media, or advertisements, should maintain consistent messaging. Consistent visual identity, including logo, colors, fonts, and tone of voice, helps in creating a recognizable and trustworthy brand image across all platforms.

Step 9 – Building Brand Trust and Credibility

Handshake client satisfied with effective diverse group meeting concept

Building trust and credibility is fundamental for long-term brand success. This involves being transparent, reliable, and making sure data security. Transparency is about being open about your product origins, values, and business practices. 

Consumers appreciate brands that are honest and clear about what they stand for. Making sure reliability means consistently delivering high-quality products or services. This consistency builds consumer trust and loyalty. 

Finally, safeguarding customer data and respecting privacy are critical in today’s digital age. Consumers need to feel secure when interacting with your brand.

Positive Brand Equity vs. Negative Brand Equity

Positive brand equity occurs when a brand’s associations and experiences are favorable among customers. 

Imagine a brand that consistently delivers high-quality products, excellent customer service, and aligns with values that resonate with its audience. This creates positive brand associations, leading to increased customer loyalty and advocacy. 

Customers are more likely to recommend the brand to others, driving business growth and enhancing the brand’s reputation.

On the flip side, negative brand equity happens when a brand’s associations and experiences are unfavorable. This could be due to poor product quality, inconsistent customer service, or unethical business practices. 

Negative brand equity can lead to decreased customer loyalty, making it difficult to attract new customers and retain existing ones. It can also diminish brand recognition and harm the brand’s overall reputation. 

Methods to Measure Brand Equity

Measuring brand equity is essential for understanding its impact and making informed strategic decisions. 

Various metrics can be used to assess brand equity, including customer surveys, brand recall surveys, perception analysis, and social listening tools.

Measure Brand Loyalty Through Customer Surveys

Customer surveys are one of the most effective ways to measure brand loyalty.

By asking customers directly about their purchasing habits, preferences, and likelihood to recommend your brand, you can gauge just how strong that loyalty really is. 

It’s like a relationship check-in—are they sticking with you or starting to drift toward competitors? 

These surveys also reveal areas where you can improve, helping you keep those loyal customers engaged. 

Assess Recall with Surveys

Brand recall surveys are your go-to tool for figuring out how well your brand is sticking in people’s minds. 

Ever had a brand pop into your head when you need something specific? That’s brand awareness in action.

These surveys help you see if your branding efforts are doing the trick by asking consumers how well they remember your brand. 

Are they thinking of you when it counts, or are you being forgotten in the noise? It’s a quick way to measure if your marketing is really hitting home.

Measure Perceived /Quality with Perception Analysis

Typing and reading google analytics

Wondering if your product lives up to consumer expectations? 

Perception analysis is all about getting feedback on how customers view your product’s quality. Do they think it’s durable, reliable, and worth the price? 

Or are there gaps between what you offer and what they expect? This analysis gives you a window into how your brand’s quality is perceived in the market. 

High-perceived quality means you’re exceeding expectations, and that often translates into better reviews, more sales, and loyal customers who believe in your brand.

Monitor Brand Associations with Social Listening

Close-up of businesswoman hand writing notes in her office

Want to know what people really think about your brand? 

Social listening tools give you real-time insights into consumer conversations and sentiments. Whether it’s a tweet, a review, or a comment on a forum, these tools track how people talk about your brand and what associations they’re making. 

Are they connecting your brand with values you want to be known for, or is there room for improvement? 

Social listening helps you stay ahead of trends and respond quickly to any emerging issues so you can keep those positive associations strong.

Over To You

Establishing and maintaining brand equity is crucial for long-term business success. A favorable brand image leads to customer retention and advocacy, driving sustained growth and profitability. 

Companies must invest in building positive brand equity to enjoy these benefits and avoid the pitfalls of negative brand equity. Building brand equity is a continuous effort, but the rewards are immense. 

A strong brand becomes a household name, fostering deep customer relationships and creating a lasting impact in the market. It’s a journey worth embarking on for any company looking to achieve long-term success.

Key Takeaways:

Brand equity is not just about names or logos; it’s about consumer perceptions, loyalty, and emotional connections that can significantly impact a company’s success.

Keller’s Brand Equity Pyramid outlines the process of building brand equity through four levels identity, meaning, response, and resonance, emphasizing the importance of emotional connections and customer loyalty.

Investing in brand equity can lead to long-term benefits, such as the ability to charge premium prices, enhanced customer loyalty, and increased market share, highlighting the necessity for continuous improvement and adaptation.

FAQs

1. What is brand equity?

Brand equity, or the brand's equity, is the value a brand brings to a company, influenced by its reputation, customer perceptions, and loyalty. High brand equity, stemming from the brand’s perceived quality and positive customer associations, can lead to increased sales, profit margins, and customer trust. Brand equity represents the tangible and intangible value of the brand in the market.

2. How to understand brand equity?

Brand equity is a complex and multi-dimensional concept that represents the value of a brand. Imagine two identical products—one branded and one generic. The branded product often commands a higher price, profit margin, and enjoys greater customer loyalty due to the same brand name. This difference in value defines brand equity and illustrates how brand perception can drive brand equity. It’s the intangible asset that makes your brand more than just a name or logo; it’s about the relationships, brand association, and trust you’ve built with your customers over time. Positive or negative brand perception significantly impacts a brand’s ability to resonate with potential customers along their customer journey.

3. Why is Brand Equity Important?

Brand equity is important because it represents the overall value and reputation of a brand. Think of it as the goodwill your brand has earned in the marketplace, which enhances the brand's perceived value. When you have strong brand equity, attracting potential customers becomes easier, and retaining existing ones feels almost effortless. A recognized brand with high brand equity means more brand equity, which can reduce marketing costs, drive brand equity further, and improve customer loyalty. This is because a positive brand reputation fosters trust and loyalty, making customers more likely to stick with you through thick and thin.

4. How can a company measure brand equity?

To effectively measure brand equity, companies should use customer surveys, brand recall assessments, and social media listening tools to gather insights on brand perception and awareness. This approach helps in understanding how consumers view the brand and its value in the market, which is essential to determine the brand's equity. Evaluating both tangible and intangible value, such as the brand’s perceived quality and positive feelings, offers a complete picture of its impact on the company's profitability.

5. What are the benefits of strong brand equity?

Strong brand equity gives you the upper hand with better pricing power, improved profit margins, and boosts customer loyalty. Additionally, it can lead to higher brand valuation, enhance the brand's perceived quality, and make it easier to introduce new products or marketing campaigns. A brand with high brand equity is often considered a valuable brand asset, and this helps the company differentiate from competitors and build brand awareness.

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