Blog . Blog . Blog

Brand equity: four tools to increase your brand's value

“Brand assets have real value. This statement is essential to living in the new world of brand as asset, with all its consequences, from business strategy to marketing programs, from resource allocation to brand management” – David Aaker, “On Branding” (free translation) 


As recently as 1991, American professor and author David Aaker stated in the synopsis of his book devoted entirely to brand equity management, “the most important assets of a business are intangible” (free translation). 


Nowadays, this statement is truer than ever – and holds enormous potential in store for companies that manage to apply it. That’s why we invite you to understand more about brand equity and how your company can benefit by increasing its brand value.


“Okay, but first…

What is brand equity?”


In essence, brand equity means “brand value.” When we talk about brand equity, we are fundamentally talking about the public’s perception of a brand. It is the reason why we choose one brand over another in the same category that has the same benefits. Or even the reason why we are willing to pay more for a product or service of brand A, but would never do the same for brand B.


At first, the concept of brand equity may seem complex, since it involves intangible criteria related to the perception of a brand by the public. But the reality is that good brand equity management is capable of propelling a business towards concrete and surprising results.

For example: you may have seen the classic picture of a cup of white coffee being sold at 1x, next to the same cup of white coffee, but this time with the Starbucks logo, being sold at 5x, right? That’s what we are talking about, the additional value added to the product or service when it is linked to a strong and positively recognized brand.


“And why should I pay attention to my brand’s brand equity?”


There are several reasons why brand equity is so important for a business. Let’s see:


First of all, Brand Equity determines how the audience feels and will interact and engage with your brand. As already explained, when we talk about brand equity we are talking directly about the public’s perception of your brand. A positive perception opens space for influence and innovation in the market, favors loyalty relationships between stakeholders and the brand, and increases customer confidence when buying and making decisions.


According to Philip Kotler, “retaining customers can be 5 to 7 times more economical than investing in new customers”. This means that brands that build loyal relationships – and even have the potential to turn customers into brand advocates – can benefit financially in the long run, considering that these customers usually have higher average tickets.


As a result, we realize that brand value also generates profitability for the business. The studies conducted by David Aaker concluded that “when there is a real change in brand equity […] there is a significant and measurable effect on return on equity” (free translation), affecting the value of the business.


Finally, another relevant point is the conclusion of the Kantar BrandZ 2021/2022 Most Valuable Brazilian Brands survey that says that “companies that invest in brand equity are also those that have a faster recovery when the storm passes” (free translation) In times of crisis and instability, the brands that hold the attention, trust, and loyalty of consumers will remain on the radar, ratifying the importance of working on brand positioning and identity with consistency, even during the storm.


How to increase my brand’s brand equity?


David Aaker teaches us that we need to be aware of four dimensions, which we bring here along with some thoughts that, if well applied, can serve as tools to leverage the value of your brand:


1) Perceived quality: this is the perception of the consumer regarding the quality of both the products and services, and the brand experience. This perception regarding quality can determine the value the customer sees in your product or service, as well as how much they are willing to spend more for them.


Food for thought:

– How is your brand’s quality control going?

– Is this quality easily perceived by your audience?

– Is your brand providing a positive brand experience for your stakeholders?

– Do your customers question your prices?


2) Awareness: Aaker teaches that “people like what they know and are prepared to attribute various positive characteristics to items with which they are familiar” (free translation)  When we talk about brand awareness, we are talking about increasing the visibility and familiarity of the brand as a first step to developing positive associations. The mere fact that the brand is “on the radar” of its audience already has an impact on consumer behavior and perception, enabling it to be remembered at decisive moments, such as moments of purchase.


Food for thought:

– How is your brand’s visibility?

– How familiar is your target audience with your brand?


3) Associations: in this dimension, we understand and determine the associations to be developed and strengthen them, in order to differentiate and position the brand in the market, and generate positive emotions and attitudes in the consumer. Here, we talk about the most diverse associations, such as symbols, brand personality, consumer image, design, product attributes… Such associations have the potential to provide the public with reasons to buy from your brand and not from another that offers the same products or services.


Food for thought:

– What elements and words are often associated with your brand?

– What feelings do these associations elicit?

– How do you expect your brand to be perceived by the market?

– What strategic brand actions will help your brand develop and strengthen these associations?


4) Loyalty: here, we look at the basis of the relationship with the customer, aiming to make it deeper and more meaningful. This is because, to build and/or increase brand equity, you need to be aware of your customers’ loyalty. Building and maintaining a loyal link with your consumers brings benefits to the business: besides being difficult to be broken by competitors, it lowers the cost with marketing and decreases the response time in the face of competitive threats within the market.


Food for thought:

– Do your customers usually return for new products and services?

– Are your customers engaged in the brand’s communication channels?

– Do your customers tend to become brand promoters or advocates?


“Can Branding help me increase the Brand Equity of my business?”


Absolutely! Ultimately, brand equity is nothing more than the value derived from a strong, positive and well-managed brand identity, and this is where Branding becomes essential.


Branding comprises the strategic management of a brand with the objective of giving it meaning, personality and relevance, so that it differentiates itself in its market and awakens positive sensations in the minds of its stakeholders. In this process, we build strategic brand platforms that manifest the essence and uniqueness of each business. As a result, we give life to strong, authentic, and coherent brands that become true assets.   


Understanding this, we can conclude that along with other attributes such as quality control and customer experience, branding is one of your brand’s greatest and most powerful allies when it comes to increasing brand equity. It must be understood, however, that we are talking about strategic management, and that building brand assets requires continuous and consistent efforts aimed at increasing asset value and developing the brand’s potential impact over time. 


Read more

Do you want to stay updated on our content and news?

Sign up below.