What is Brand Equity?
Definition and Meaning
Brand equity is a common marketing term that describes a brand’s value. Now, we’re not referring to a company’s profit. Rather, this value is based on how customers perceive the company as a whole.
If customers generally think positively of a brand, the company has good brand equity. If customers have a negative perception of a brand, the company would have poor brand equity. It’s all based on the judgement of consumers.
Why is Brand Equity Important?
Customers will be willing to buy from your company if you have positive brand equity. On the flip side, they’ll be wary of your brand and products if you have negative brand equity.
There are financial benefits of having positive brand equity. A company can charge more for a product if their brand has that built-in clout. We see this all the time with Apple, a company that has some of the highest brand equity in the entire world. Apple’s phones are pricier than the competition, but customers will spend money on the products, partly due to Apple’s positive brand equity.
What Are the Other Benefits?
Companies will use their brand equity to endorse unaffiliated products. Thanks to their standing in an industry, customers will be willing to pay for a familiar name. In this scenario, the company would be making money solely based off their name and logo.
Another financial incentive has to do with a company’s stock price. If your brand equity has taken a jump, the lofty standing will then be reflected in the stock price.
How Do You Develop Brand Equity?
One way to develop brand awareness is by having customers experience and interact with your services and products. This is a natural progression, and a high-quality product will have customers returning to your brand.
Marketing experts focus on a five-step process in their pursuit of brand equity. First, make your audience aware of your brand. Clever advertising and marketing can boost this awareness, and customers will then start to recognize your company. The trial run comes when these customers finally try out your service and products, and your top-notch offerings should lead to preference. Then, when customers are continually returning to your company, you’ve achieved loyalty, which is the pinnacle of brand equity.
Should I Be Focused on Brand Equity for My Spreadshop?
No matter the size of your business, you should always be focused on brand equity. If you want to make money, your customers’ perception of your brand can go a long way in boosting profits.
To help improve your brand equity, you can focus on a social media marketing campaigns, and these can help guide visitors to your Spreadshop. Even generating followers is important; if these consumers consistently see your designs, they’ll be inclined to make a purchase.
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