Brand Equity Is Important To Every Business. When It’s Done Right, It Will Make You Money!
What Is Brand Equity – Why It Matters
Think about the last place you visited. Whether it was a store, a gas station, a bank, or a restaurant you probably went there because the place was familiar to you. You knew what to expect when you walked in the door. Your previous experience with the place let you know the money you spent there would not go to waste. Quality of service was most likely not a question. They didn’t have to prove themselves to you.
This is a result of one thing: brand equity. This is the idea. It’s like building equity in a home. The more you put into it, the more you will get out of it. It will pay sweet dividends for you, especially over time. Once people know you, they know what to expect from you and your business, it becomes so much easier to attract and retain business.
If you do this right, you’ll even be able to charge a higher price than your competitors. People will feel good just because it is your product. It’s the same reason people by Lucky Charms or Cheerios instead of the off brand equivalent. People buy with their emotions, NOT with their heads. This is why you need to build brand equity. It is exactly the perceived value of your businesses and the services you provide.
Brand Equity – Component Breakdown & tips
- Brand Recognition: This is referring to how many people recognize your name when it is said. What matters here is not that everyone knows of you, but the people who you serve know who you are. If you sell watches, you want all the watch owners & prospects to know who you are. You do not, however, want all the car owners and prospects to know who you are. Those are wasted marketing dollars.
- Brand Awareness: You may think this is the same thing as recognition. You would be incorrect. It is similar, but it takes the concept deeper. In particular, this refers to understanding what that brand does that makes it different. With Rolex, its providing higher quality watches than the rest of the competition. Same thing with Ferrari & Lamborghini. You’re willing to pay more because you are AWARE of what the brand means.
- Customer Experience & Preference: These go hand in hand. The experience your customer has with you, every one of them, matters. Significantly so. The better you average customer experience, the more your customers will prefer your products. This doesn’t necessarily have to be product quality. How your customer is treated in the store is half the battle. This increases the perceived quality, and therefore price your customer is willing to pay.
- Unique Value Proposition: This the most important of any of the components of brand equity. It is important for the long term success of your business that you have a unique offer that genuinely separates you from your competitors. Whether it’s the ability to offer a product/service at a lower price with the same quality, or offering something nobody offers with a proprietary product/service. This is what your company needs to become known for, and is by far the easiest way to quickly build your own brand equity.
Understanding these 4 basic components of your brand equity will be invaluable to the success of your business. This is a great start. In future blogs we will dive much deeper into each component of this & consumer psychology. This will help you formulate your own strategy for brand. For now if you want to dive deeper you can take a look at Keller’s Brand Equity Model. Tune in for our next blog to learn more!
Do You Need Help With Your Brand Placement Or Signage?
We at Victory Sign Company know the importance of your customers perception of your business. We’ll make sure their first impression of you is nothing but stellar. We’ll make branding your merchandise & store a breeze!
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1021 S. Brown Street, Suite K
Liberty, MO 64068
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