What Is Brand Equity? Definition, Examples and Build

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brand equity

What is Brand Equity?

The Definition

Brand equity refers to the power of a brand name in the minds of consumers and the benefit of having a well-known and remembered brand. Organizations build brand equity by providing extraordinary experiences and encouraging customers to choose them over competitors that sell identical goods.

Brand equity denotes the value the brand name has in the market. Brand equity is the added value of a product apart from its performance and service value. 

Depending on the customer’s perception of the brand, it can be positive or negative.

Brand equity shall be measured and added to the product’s service value. The intention is to realize the product’s actual value and gain appropriate profits. 

Brand equity is directly related to the reputation of the brand. Brand equity is positive if it has garnered a good reputation through its services or marketing strategies. 

If the brand has made a bad name among the customers, it has negative brand equity. 

How to Build Brand Equity?

Positive brand equity reflects trust among the customers. Hence to build brand equity, you need to make customers trust the brand. Brand equity can get outlined in three parts: market perception, negative or positive impact of brand equity, and final value. 

Two significant variables contribute to brand equity: awareness, recognition, and user experience.

You need to address questions like: how do the customers identify the brand? How do they perceive it? Your marketing techniques should connect with the customers and convey the brand’s qualities. 

Then comes the user experience. If a product disappoints the user, the whole brand value goes down, affecting other products of the same brand. 

A satisfactory customer experience adds up positively to the brand image and equity. Address the customer’s wants

Understand your motives associated with the brand. What purpose is it serving, and why is it being made and delivered? 

Avoid making rapid changes in the brand ideology, advertisement, designs and logos, and taglines. 

Keller’s brand equity model is a successful model for creating a long-lasting brand. This model is a step-by-step process of building brand identity, brand meaning, brand response, and brand resonance

How to measure brand equity?

Brand equity can get assessed by brand tracking. It tracks the impact and ROI of marketing strategies. 

From a financial perspective, you can evaluate equity in the form of market share and revenue potential. 

Brand equity can also get figured out by deducting performance value from total brand value. 

Brand auditing aims at analyzing brand value and equity. 

Also, with the help of Keller’s brand equity model, the brand’s standing on its four significant aspects helps understand brand equity. 

Brand equity vs. Reputation

Confusing the terms “brand” and “reputation” might have severe consequences for your company’s long-term health.

Brand and reputation are intrinsically related rather than being synonyms. Your brand can help you improve your reputation. On the other hand, a bad reputation can destroy a brand that a company has worked hard to create over decades, if not centuries.

A company’s brand is how it represents itself to customers, employees, and the general public. A well-developed brand is a public reflection of a business’s fundamental beliefs.

Senior executives have more authority over a company’s brand. It stems from the things it sells, the stores it sells, and the well-executed advertisements, social media posts, and print advertising. It uses these elements to raise awareness of what it is and represents.

Press coverage, word-of-mouth, and online talk help create reputations outside the boardroom. It’s about how the general public views your firm and whether—and to what extent—the general public believes you’ve delivered your brand promise. It can influence a company’s reputation, but it can’t be created (or re-created) like a brand.

Theoretically, branding is essential; in practice, reputation is. The promise is the brand, and the delivery on that promise is the reputation.

Brand Equity Examples That Will Make You Rethink Your Strategy


The best illustration of brand equity is Apple. Even though this brand’s products have comparable qualities, its loyalty, demand, and price premium are higher than those of similar brands.


Many other social networking sites have gone, but Facebook has remained steadfast. Facebook has built such a strong brand that most users don’t bother with other social networking networks.


Despite a protracted prohibition on Maggi’s main noodle product in India, the product was in high demand. That is even after its reintroduction to the market. Maggi is the best positive illustration of how high brand equity can assist a company in dealing with various market conditions.


What are the examples of brand equity?

Brands with prominent names like Sony, Apple, Adobe, Starbucks, BMW, etc. The data through customer surveys show that brands like these are trusted over others.

This trust over the brand name adds to the value a customer is ready to pay, thus adding to the brand value.

What is the role of brand equity?

Brand equity is the reflection of the value a brand’s name holds over the market. It shows the consumer’s perception of the brand.

Hence it can increase or decrease the company’s profit margins based on the value of the brand image.

How can brand equity be improved?

It can be improved by effective marketing, advertisement, and most importantly, customer experience and success. Better service to the user will give a better name to the brand thus the user shall be prioritized.

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