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Brand Equity Case Studies: A Guide to Building Powerful Brands

In the high-stakes game of brand equity, winning is not just about outlasting the competition. It’s akin to striking gold in the era of the Gold Rush. So, why do some brands hit the jackpot while others merely strike dust?

Unwrap the mystery with us as we venture inside the minds behind brands that took off—one brilliant strategy at a time.

Just how powerful can a well-built brand be? Consider this: Apple, the crowned king of brand equity, is now worth over $2 trillion, equivalent to the GDP of Italy, the world’s eighth-largest economy. In this modern business world where a strong brand can dwarf the economic might of entire nations, brand equity is no longer a nice-to-have—it’s a must have.

In true chronicler style, we’ve mined gold nuggets of wisdom from the trenches of successful brand building. Veterans, rookies, or mere observers of the business world—step into this treasure trove of case studies and learn how to create a brand that could figuratively (or literally!) be worth its weight in gold.

The Power of Brand Equity: Case Studies

• Probe the intricate mechanisms of iconic brands Rolex and L’Oreal
• Uncover the dynamic strategies that fortified their brand equity
• Decipher the commercial reverberations of robust brand equity

Case Study 1: Rolex’s Brand Equity

Renowned for its unrivalled precision and unwavering quality, Rolex etches its brand identity in the bedrock of luxury timepieces. Firmly revered in consumer minds, Rolex’s brand equity didn’t simply surface overnight. Endurance, consistency, and authenticity thread together the intricate tapestry of Rolex’s brand avowal.

Rolex fortified its brand equity through meticulous craftsmanship, customer engagement, and astute product positioning. Adopting a constrictive manufacturing algorithm, Rolex curates each timepiece in-house, fostering an exclusive allure. Moreover, the brand ventured beyond functional utility, penetrating cultural, sporting, and scientific realms pageantry, which resoundingly resonated with a wide consumer base. Thus, sculpting the brand into an emblem of achievement, gradually amplifying its brand equity.

The precision timepiece maker’s strong brand equity unequivocally propelled its market position, securing a prominent spot in the luxury chronograph arena. With invincible brand equity, Rolex hones enticing purchase incentives fueled by a reputation of quality and prestige, thereby nurturing customer loyalty and ensuring premium pricing.

Case Study 2: L’Oreal’s Customer-Based Brand Equity

A cosmetic colossus looming in the beauty industry, L’Oreal strategically formulated a resonating Customer-Based Brand Equity (CBBE) model. Proclaiming “Because I’m Worth It,” L’Oreal extols individuality and empowerment, coaxing deep customer connections. This assertive clarion call shapes the bedrock of L’Oreal’s CBBE model.

Masterfully orchestrating its CBBE model, L’Oreal initially established brand salience and crystallized brand performance perceptions, cultivating strong customer associations with quality and innovation. Unveiling products aligned with contemporary beauty standards, and proactively addressing beauty gender stereotypes solidified the brand’s resonance.

The intelligent CBBE model execution facilitated L’Oreal to buttress a powerful brand equity. The model nurtures proliferative brand awareness and elicits strong consumer engagement, fashioning robust brand loyalty. Consequently, the culminating brand equity not only contributes to premium pricing and greater marketing communication efficiency but also cushions potential market volatility, signaling a potent brand equity.

With deep insights into two global giants’ brand equity voyage, one can decode the power of strong brand equity: commanding premium pricing, fostering loyalty, and weaving an indomitable market position. Crafting a compelling brand narrative and fostering customer associations are instrumental in nurturing brand equity and magnifying market pervasiveness.

The Art of Building Brand Equity: Lessons from the Case Studies

• Learn to quickly recognize your target audience
• Make your brand unique and instantly recognizable
• Consistently deliver the experience your audience expects

Understanding Your Target Audience

Getting a firm understanding of your target audience is a critical first step in building brand equity. Take Rolex and L’Oreal for example.

Rolex, already a titan in the luxury watch sector, targeted its audience not only by financial status but also by lifestyle. They understood that their watches were purchased by individuals who appreciate high craftsmanship and lead lifestyles that warrant a high-end timepiece. They target their communication around these aspects, building more equity for their brand.

In a different sector, beauty brand L’Oreal understood that their target audience is not monolithic. Rather than attempting one-size-fits-all marketing, they deeply understand the demographics and psychographics of their different customer segments to tailor messages, products, and campaigns. Their brand’s strength and equity lie in this fine-grained understanding of varied consumer preferences.

Change the way you view traditional audience segmentation, remembering that it’s essential to build your brand’s power.

Creating a Unique Brand Identity

The strength of your brand equity hinges significantly on a unique brand identity. Observe how Rolex and L’Oreal transformed their brand identities into powerful assets.

Rolex exudes elegance, tradition, and impeccable craftsmanship. Their brand identity is so unique that people instantly associate these attributes with them. Rolex invests heavily in maintaining this identity through each marketing and branding effort.

Similarly, L’Oreal carved out a unique identity by aligning the brand with beauty, diversity, and innovation. These core values reverberate across their product lines, campaigns, and overall messaging, maintaining consistency and reinforcing brand equity.

Reconsider your current brand identity. Does it offer the uniqueness and consistency seen in these examples? Your brand’s strength could lie in a shift towards uniqueness.

Delivering Consistent Brand Experience

A consistent brand experience creates trust and acts as a solid foundation to build strong brand equity. Rolex and L’Oreal showcase this effectively through their customer interactions.

Rolex delivers a consistent luxury experience across all customer touchpoints. From the in-store experience to after-sales service, Rolex buyers know precisely what to expect—a high-end interaction in line with the brand’s reputation.

Similarly, L’Oreal ensures a consistent brand experience across all customer interactions. Whether through their products, customer service, or even their social responsibility efforts, L’Oreal’s consistency builds trust and reinforces brand equity.

The key learning here is consistency. A consistent brand experience at all touchpoints builds trust and affects your brand equity positively.

Measuring Brand Equity: Key Metrics and Methods

• Three robust metrics to measure brand equity – brand awareness, brand loyalty, and perceived quality
• Practical ways of how industry leaders like Rolex and L’Oreal evaluate these metrics

Brand Awareness

Brand awareness sits high on the checklist for measuring brand equity. It quantifies how icily a brand is recognised by potential consumers and to what extent their products or services are associated with the brand name. Leveraging brand awareness can make advertising efforts more impactful, ultimately leading to enhanced sales and increased market share.

Rolex and L’Oreal are two industry giants that serve as excellent examples in this context. The coveted watchmaker, Rolex, uses surveys and social media audits to gauge its brand visibility. By asking relevant questions and tracking digital engagement, it quickly identifies the areas of strength and those that need more focus.

L’Oreal adopts a similar route by incorporating digital audits, customer surveys, and competitive analysis. It also understands the power of influencer marketing and collaborations to amplify brand recognition.

Brand Loyalty

Another pivotal metric in gauging brand equity is brand loyalty. It measures the attachment and devotion customers have towards the brand and how likely they are to repeat purchases. High brand loyalty signifies minimized marketing costs, steadier revenues, and powerful word-of-mouth advertising.

In assessing brand loyalty, Rolex and L’Oreal have distinct methods up their sleeves. Rolex banks on the prestige of its brand name and customer satisfaction surveys to determine its consumer loyalty. Promotions and advertising predominantly revolve around the brand’s legacy, craftsmanship, and the feeling of exclusivity.

On the other hand, L’Oreal relies on data from loyalty programs, surveys, and customer reviews. By rewarding recurring customers through loyalty programs, L’Oreal gets first-hand data on their purchasing habits, enabling it to better cater to their needs and retain them.

Perceived Quality

Perceived quality, though slightly more abstract, is a vital metric for measuring brand equity. It refers to a consumer’s opinion of the overall quality or superiority of a product or service in relation to its intended purpose, as well as any alternates.

Rolex and L’Oreal have unique ways to determine their perceived quality. Rolex safeguards its stellar reputation for quality and craftsmanship through strict controls and certifications. Feedback from after-sales services also provides valuable insights about the perceived quality factor.

L’Oreal follows a customer-centric approach. It focuses on product reviews, feedback and continuously evolves its products based on that. It constantly checks the temperature of customer satisfaction to fine-tune its offerings and maintain high perceived quality.

These metrics and methods together provide a holistic view of brand equity. Monitoring these elements and acting upon the insights they offer, brands can draft robust strategies to strengthen their market presence.

Managing Brand Equity for Long-Term Success

• Delve into the role of regular brand audits in safeguarding brand quality
• Recognise the significance of consistent brand communication in sustaining brand value
• Understand how successfully adapting to market changes optimizes the brand equity

Regular Brand Audits

The core purpose of regular brand audits is to verify if your brand is performing well, maintaining its intended perception, and keeping its promises to customers. It serves as an established system to monitor changes to your brand’s image, equity, and overall effectiveness in the market.

For instance, Rolex, known for its timeless elegance and precision, conducts frequent brand audits. These allow the company to ensure that their brand image remains synonymous with luxury, high-quality, and craftsmanship. They frequently review their marketing strategy, products, and customer perceptions to maintain these associations.

Similarly, L’Oreal, a leading name in the beauty industry, regularly verifies that its brand stays true to its promise of innovation, quality, and beauty empowerment. The insights obtained from these audits effectively guide L’Oreal’s brand strategies, facilitating adjustments to remain aligned with the changing customer expectations and market trends.

Consistent Brand Communication

Consistent brand communication plays a pivotal role in managing brand equity. It ensures the brand’s value and message remain unvarying across all platforms and points of customer interaction, building trust and reinforcing brand identity.

Rolex excels in this domain by maintaining a uniform brand voice and aesthetics across their marketing campaigns. It effectively communicates Rolex’s commitment to quality, precision, and high status. Every public communication from Rolex, be it in print, digital, or at their flagship stores, actively embodies these values, thereby reinforcing its brand equity.

In a similar vein, L’Oreal ensures consistent messaging by emphasizing its core values of innovation, inclusivity, and beauty empowerment across all branding initiatives. From their product design to marketing campaigns, L’Oreal’s persistent communication reiterates its promise to deliver high-quality beauty solutions.

Adapting to Market Changes

Adapting to market changes is paramount if a brand aims to sustain its equity over time. It’s crucial to remain flexible, ready to evolve with changing customer expectations and market landscapes while preserving the core brand identity.

Rolex, for instance, has deftly balanced the art of incorporating cutting-edge technology in their watches without deviating from their classic design language, effectively adapting to modern market demands. This blend of innovation, along with time-honoured craftsmanship, has enabled Rolex to consistently top lists of powerful global brands.

L’Oreal, too, has shown remarkable agility in responding to market changes. Recognizing the shift towards natural and cruelty-free beauty solutions, they’ve expanded their line-up to include vegan options, effectively aligning their product offerings with customer needs and market trends. This ability to adapt while maintaining brand consistency has bolstered L’Oreal’s brand equity in the intensely competitive beauty market.

Implementing Successful Brand Equity Strategies: Key Takeaways

• Unpack the CBBE model and its application in top brands like Rolex and L’Oréal
• Extract valuable nuggets from successful brand equity strategies, Rolex and L’Oréal in particular
• Obligation for constant development and improvement of your brand equity, with Rolex and L’Oréal as prime examples

Understanding the CBBE Model

Breaking down the rather complex model into manageable and studied blocks, the CBBE (Customer-Based Brand Equity) model holds an integral role in building and sustaining powerful brand equity 

The CBBE model, in the context of business and marketing, typically refers to the “Customer-Based Brand Equity” model. This model, developed by Kevin Lane Keller, is a well-known approach to understanding a brand’s value from the perspective of the customer. It’s focused on how consumers think, feel, and respond to a brand, and is structured around four key components:

• Brand Identity (Who are you?): The starting point where a brand aims to create awareness about who it is and what it stands for.
• Brand Meaning (What are you?): Involves establishing brand associations through attributes and benefits to give the brand a specific meaning in the customer’s mind.
• Brand Responses (What about you?): How consumers react to the brand, both in terms of their judgments and feelings related to its perceived quality and emotional resonance.
• Brand Resonance (What about you and me?): The ultimate relationship and level of identification that a customer has with the brand, including a sense of community and engagement.

To illustrate this model, here’s a simple diagram:

In this diagram:

• Brand Identity is at the top, representing the foundation.
• Brand Meaning and Brand Responses sit in the middle, indicating the development of brand understanding and customer reactions.
• Brand Resonance is at the bottom, showcasing the peak of customer-brand relationship.

This structure helps in understanding how a brand can develop its equity through various stages of customer perception and interaction. It emphasizes that strong brand equity is built when a brand consistently delivers on its promises, leading to a loyal customer base.

Big brands, like Rolex and L’Oreal, harness the power of the CBBE model to develop, monitor and manage their brand equity. Rolex, a symbol of prestige and luxury, carefully crafted its brand perception through stellar product quality, distinctive design, rich heritage and celebrity endorsements. All these facets portray the CBBE model elements significant to establishing solid brand equity.

Meanwhile, L’Oreal is another CBBE model follower. By emphasizing diversity in their product line, consistent quality, and a global presence, they have successfully built a body of loyal customers.

Learning from Successful Brands

Standing on the shoulders of giants should never be underrated. Brands like Rolex and L’Oreal are not successful by accident; they employ deliberately structured and tested strategies to develop powerful brand equity.

From Rolex’s product differentiation and fascinating brand stories to L’Oreal’s inclusivity and innovative product line, several substantial lessons can be learned. Rolex is associated with luxury and prestige due to its ability to deliver on its brand promises consistently – a lesson in standing by your brand’s benefit to the customer.

L’Oreal, on the other hand, has conquered the vast and diverse beauty market by adapting its offerings to cater to different ethnic, cultural, and age groups – a lesson in adaptability, inclusivity, and market understanding.

Continuously Improving Your Brand Equity

Brand equity is not a fixed destination; it’s a relentless journey. Forces in the business landscape are ever-changing, calling for a constant evolution and improvement of your brand equity.

It’s impressive to observe how mastering brands like Rolex and L’Oreal thrive amidst such changes. Rolex has shown noticeable evolution in their designs, continuously adapting to changing fashion trends, yet retaining their classic elements that make a Rolex unmistakably a Rolex.

Likewise, L’Oreal’s continuous innovation and expansion into new product categories illustrate their commitment to building and maintaining brand equity. Their successful navigation in the advent of the digital era and social media marketing, for instance, highlights their commitment to constant development.

Rolex, a paragon of luxury timepieces, didn’t just fortify its brand equity overnight. It’s a saga of endurance, consistency, and authenticity woven into the fabric of high-end horology.

Key Strategies:

• Meticulous Craftsmanship & Exclusivity: Each timepiece is crafted in-house, signifying quality and uniqueness.
• Strategic Sponsorships: Rolex’s associations with prestigious events like Wimbledon and the Open Golf Championship elevate its luxury persona.
• Iconic Endorsements: Collaborations with influential figures like Roger Federer and James Cameron resonate with Rolex’s image of excellence and adventure.

Consumer Perception & Competitive Edge:

• Data on Consumer Perception: Surveys indicate Rolex’s synonymous association with luxury and status.
• Differentiation: Unlike its competitors, Rolex maintains a unique blend of classic design and modern innovation, appealing to both traditional and contemporary tastes.

L’Oreal has adeptly woven the Customer-Based Brand Equity (CBBE) model into its brand fabric, championing beauty and diversity.

Application of the CBBE Model:

• Brand Identity: “Because I’m Worth It” slogan champions individuality and empowerment.
• Brand Meaning: Innovative products like the wide-ranging shade foundations cater to diverse beauty standards.
• Brand Responses: Campaigns addressing beauty stereotypes to foster positive consumer reactions.
• Brand Resonance: Loyalty programs and community-building initiatives create deep customer connections.

Diversity and Digital Strategies:

• Inclusivity Initiatives: L’Oreal’s commitment to diversity is evident in its product lines, such as True Match foundation range.
• Digital Marketing: Leveraging social media for targeted campaigns, engaging with influencers to amplify brand awareness.

Impact and Innovations:

• Market Adaptability: Introduction of vegan and cruelty-free products in response to market trends.
• Customer Engagement: Digital transformation strategies, including online beauty consultations, have enhanced customer interaction and loyalty.

Outcomes & Lessons:

• Rolex: The brand’s unwavering focus on quality and luxury has solidified its market position, allowing it to command premium pricing.
• L’Oreal: Embracing diversity and digital innovation has expanded L’Oreal’s market reach and solidified its global brand equity.

Planting the Seeds of Brand Equity

Exceptional brand equity isn’t stumbled upon, but carefully cultivated. From strategic brand positioning to a razor-sharp focus on consumer engagement, every step builds towards a stronger, more impactful brand. In all of these, consistency is your comrade and patience, your power.

This information in your hands is a roadmap to building a name that not only resonates with your audience but wins their loyalty. Undoubtedly, accruing brand equity is a marathon, not a sprint.

Start now; Implement these outlined strategies in your operations. Fine-tune your brand voice, commit to delivering value, focus on customer experience, and consistently measure your progress.

Think through this: How can you infuse more value into your customer’s journey today?

Remember, the market doesn’t just respect great brands; it rewards them. Stand out, make an impact, build your brand equity. Every action today sows the seeds for a bountiful harvest tomorrow.

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What is Brand Equity? Definition, Measurement, Examples

Appinio Research · 18.03.2024 · 31min read

Have you ever wondered why some brands seem to effortlessly capture the hearts and minds of consumers while others struggle to gain traction in the market? Understanding the concept of brand equity holds the key to unraveling this mystery. Brand equity isn't just about logos and slogans; it's about the intangible value that a brand holds in the eyes of consumers. It's about the trust, loyalty, and emotional connection that consumers have with a brand, influencing their purchasing decisions and behaviors. In this guide, we'll explore the fundamentals of brand equity for businesses, delve into the components that contribute to brand equity, examine strategies for building and enhancing brand equity, and discuss challenges and risks in managing brand equity. Whether you're an entrepreneur looking to establish a new brand or a seasoned marketer aiming to strengthen an existing one, understanding and effectively managing brand equity is essential for driving success in today's competitive marketplace.

What is Brand Equity?

Brand equity is a fundamental concept in marketing that encompasses the intangible value and perception associated with a brand . It represents the accumulated goodwill, trust, and loyalty that consumers have towards a brand, influencing their purchasing decisions and behaviors. Brand equity is built over time through consistent delivery of superior products or services, effective marketing strategies, and positive brand experiences.

At its core, brand equity reflects the differential effect of brand knowledge on consumer response to marketing activities. It goes beyond tangible assets such as revenue and market share, capturing the emotional and psychological connections that consumers have with a brand. Understanding and managing brand equity is essential for businesses to maintain a competitive edge, foster customer loyalty, and drive long-term growth and profitability.

Importance of Brand Equity for Businesses

• Competitive Advantage : Brand equity serves as a powerful competitive differentiator , allowing businesses to stand out in crowded markets and command premium prices for their products or services.
• Customer Loyalty and Advocacy : Strong brand equity cultivates customer loyalty and advocacy, leading to repeat purchases, positive word-of-mouth recommendations, and increased customer lifetime value.
• Price Premium : Brands with high equity can charge price premiums compared to competitors, as consumers perceive greater value and quality associated with the brand.
• Market Expansion : Brand equity facilitates market expansion and diversification by providing a solid foundation for launching new products, entering new market segments, or expanding into new geographic regions.
• Resilience to Adversity : Businesses with robust brand equity are better equipped to weather crises, economic downturns, or competitive threats, as consumers are more likely to remain loyal to trusted brands during challenging times.
• Investment Attractiveness : High brand equity enhances a company's attractiveness to investors, lenders, and strategic partners, as it signals strong market positioning, customer loyalty, and growth potential.

Components of Brand Equity

Brand equity is comprised of several key components, each playing a vital role in shaping consumers' perceptions and behaviors towards a brand.

Brand Awareness

Brand awareness refers to the extent to which consumers are familiar with a brand and its offerings. It encompasses both brand recognition, where consumers can identify the brand when presented with its name or logo, and brand recall, where consumers can retrieve the brand from memory when considering a purchase. High brand awareness is essential for attracting new customers and maintaining a competitive edge in the market.

To enhance brand awareness, businesses employ various marketing strategies such as advertising campaigns, sponsorships, and content marketing. Leveraging social media platforms, search engine optimization (SEO), and influencer partnerships can also help increase brand visibility and reach a broader audience.

Brand Loyalty

Brand loyalty reflects the strength of the bond between a brand and its customers. Loyal customers are not only repeat purchasers but also advocates who actively recommend the brand to others. Building brand loyalty requires delivering consistent value and positive experiences that exceed customer expectations. Loyalty programs, personalized communication, and exceptional customer service are effective strategies for fostering brand loyalty.

Moreover, emotional connections play a significant role in fostering brand loyalty. Brands that resonate with consumers on an emotional level by aligning with their values, aspirations, or lifestyles tend to cultivate deeper and more enduring relationships with their customers.

Perceived Quality

Perceived quality refers to consumers' subjective assessment of a brand's products or services in terms of their performance, reliability, and value. It influences consumers' purchase decisions and willingness to pay a premium for the brand. Maintaining high perceived quality requires continuous investment in product innovation, quality control, and customer feedback mechanisms.

Brands can enhance perceived quality through transparent communication about product features and benefits, showcasing customer testimonials and reviews, and consistently delivering products that meet or exceed customer expectations. Building trust and credibility through certifications, awards, and endorsements can also reinforce perceived quality perceptions among consumers.

Brand Associations

Brand associations are the mental connections and attributes linked to a brand in consumers' minds. These associations can be based on various factors such as product attributes, emotional benefits, or symbolic meanings. Positive brand associations contribute to brand differentiation, preference, and loyalty, while negative associations can detract from a brand's reputation and value.

To shape positive brand associations, businesses must align their brand messaging, imagery, and actions with desired brand attributes and values. Creating memorable brand experiences, fostering partnerships with reputable organizations or influencers, and leveraging storytelling techniques can help cultivate strong and favorable brand associations among consumers. Regular monitoring and management of brand associations are essential to ensure alignment with brand objectives and adapt to evolving consumer perceptions and preferences.

How to Build Brand Equity?

Building brand equity is a strategic endeavor that requires concerted efforts across various dimensions of brand management. Let's delve into the key strategies for building a solid brand equity foundation.

Establishing Brand Identity

Your brand identity serves as the cornerstone of your brand equity. It encompasses the visual and verbal elements that convey your brand's personality, values, and unique attributes to consumers. Establishing a compelling brand identity begins with defining your brand positioning, target audience, and brand values.

Crafting a memorable brand name , designing a distinctive logo , and selecting brand colors and typography that resonate with your target audience are essential components of brand identity creation. Consistency is paramount in ensuring your brand identity remains cohesive and recognizable across all touchpoints, including your website, packaging , marketing materials, and social media profiles.

Moreover, your brand identity should reflect your brand's essence and resonate with your target audience on an emotional level. By articulating a clear brand story and value proposition, you can forge deeper connections with consumers and differentiate your brand from competitors.

Creating Brand Consistency

Consistency is vital to building and reinforcing brand equity over time. Consistent branding fosters brand recognition, builds trust with consumers, and reinforces your brand's values and positioning in the minds of your audience . Achieving brand consistency requires aligning all aspects of your brand, including messaging, visuals , and customer experiences.

Developing brand guidelines that outline your brand's visual and verbal standards ensures that everyone within your organization understands and adheres to your brand's identity. Consistent use of brand elements such as logos, colors, fonts, and tone of voice across all communication channels helps reinforce your brand's identity and messaging.

Additionally, maintaining consistency in product quality, customer service, and brand interactions across all touchpoints is crucial for building consumer trust and loyalty. Regularly auditing and monitoring your brand's consistency across various channels and touchpoints allows you to identify and address any inconsistencies or deviations from your brand standards.

Delivering Exceptional Customer Experiences

Delivering exceptional customer experiences is a fundamental aspect of building brand equity. Positive interactions with your brand at every touchpoint along the customer journey can leave a lasting impression on consumers and contribute to brand loyalty and advocacy.

To deliver exceptional customer experiences, businesses must prioritize understanding their customers' needs, preferences, and pain points. Personalizing interactions and tailoring solutions to meet individual customer needs can enhance satisfaction and foster long-term relationships.

Investing in employee training and empowerment is also essential for delivering exceptional customer experiences. Equipping frontline staff with the knowledge, skills, and authority to address customer inquiries and resolve issues promptly and effectively can elevate the overall customer experience and reinforce positive brand perceptions.

Moreover, leveraging technology to streamline processes, anticipate customer needs, and deliver seamless omnichannel experiences can enhance convenience and satisfaction. Collecting and analyzing customer feedback through surveys, reviews, and social media monitoring allows businesses to identify areas for improvement and continuously optimize the customer experience.

Leveraging Brand Communication Channels

Effective communication is critical for building brand equity and fostering meaningful consumer connections. Leveraging a mix of traditional and digital communication channels enables brands to reach and engage with their target audience in meaningful ways.

Traditional advertising channels such as television, radio, print, and outdoor advertising remain relevant for reaching broad audiences and building brand awareness. However, digital channels such as social media, email marketing, content marketing, and influencer partnerships offer unparalleled opportunities for targeted messaging, interactive engagement, and measurable results .

Developing a comprehensive brand communication strategy involves identifying the most relevant channels for reaching your target audience and crafting compelling messaging that resonates with their interests, aspirations, and values. Consistency in messaging and visual branding across all communication channels reinforces brand identity and fosters brand recognition and recall.

Moreover, fostering two-way communication with consumers through social media engagement, customer feedback mechanisms, and community-building initiatives allows brands to build trust, gather insights, and cultivate brand advocates. Monitoring and analyzing communication effectiveness through key performance indicators (KPIs) such as engagement rates, reach, and sentiment analysis enables brands to optimize their communication strategies and drive positive brand outcomes.

How to Measure Brand Equity?

Measuring brand equity is essential for assessing the effectiveness of your brand-building efforts and understanding how consumers perceive your brand. By analyzing both quantitative metrics and qualitative measures, you can gain valuable insights into your brand's performance and identify areas for improvement.

Quantitative Metrics

Quantitative metrics provide tangible data and numerical indicators of your brand's financial value, market share, and customer lifetime value.

Brand Value

Brand value represents the monetary worth of your brand and its ability to generate revenue for your business. Several financial valuation models, such as the Interbrand or Brand Finance methodologies, can be used to estimate brand value based on factors such as brand revenue, market trends, and brand strength.

Brand Value = (Revenue from Branded Products or Services - Operating Costs) x Brand Multiple 

Calculating brand value allows businesses to assess the financial impact of their brand on overall company performance and compare their brand's value relative to competitors.

Market Share

Market share measures the percentage of total sales within a specific market that your brand captures. Monitoring changes in market share over time provides insights into your brand's competitive position and market performance relative to competitors.

Market Share = (Brand Sales / Total Market Sales) x 100% 

Increasing market share indicates growth and expansion opportunities for your brand, while declining market share may signal challenges or threats that require strategic intervention.

Customer Lifetime Value (CLV)

Customer Lifetime Value (CLV) represents the total value a customer contributes to your business over their entire relationship with your brand. Calculating CLV involves multiplying the average purchase value by the purchase frequency and customer lifespan.

CLV = (Average Purchase Value x Purchase Frequency) x Customer Lifespan 

CLV analysis helps businesses identify high-value customers, tailor marketing efforts to maximize long-term profitability, and allocate resources effectively to acquire and retain valuable customers.

Qualitative Measures

Qualitative measures provide insights into consumers' perceptions, attitudes, and emotional connections with your brand, offering a deeper understanding of brand equity beyond financial metrics.

Brand Perception Surveys

Conducting brand perception surveys allows businesses to gather qualitative data on consumer perceptions, attitudes, and associations with their brand. Surveys may include questions related to brand awareness, brand loyalty, perceived quality, brand associations, and purchase intent.

Analyzing survey responses provides valuable insights into strengths, weaknesses, and areas for improvement in your brand strategy. It helps businesses identify brand attributes that resonate with consumers and areas where additional investments or adjustments are needed to enhance brand equity.

To effectively measure brand equity and gain actionable insights into your brand's performance, consider leveraging advanced market research tools like Appinio . With Appinio's intuitive platform, you can conduct brand perception surveys with ease, gathering qualitative data on consumer perceptions, attitudes, and associations. By analyzing survey responses in real-time, you'll uncover valuable insights into your brand's strengths, weaknesses, and areas for improvement, empowering you to make informed decisions to enhance brand equity.

Ready to take your brand to the next level? Book a demo with Appinio today and unlock the power of data-driven brand management.

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Brand Equity Index

The Brand Equity Index combines various brand metrics, including brand awareness, loyalty, perceived quality, and brand associations, into a single measure of brand health. It provides a comprehensive view of your brand's overall performance and competitiveness in the market.

Calculating the Brand Equity Index involves weighting and aggregating individual brand metrics based on their relative importance and contribution to brand equity. Regular monitoring of the Brand Equity Index allows businesses to track changes in brand perception over time and evaluate the effectiveness of brand-building initiatives.

By leveraging both quantitative metrics and qualitative measures , businesses can develop a holistic understanding of their brand's performance and make informed decisions to strengthen brand equity and drive sustainable growth.

How to Improve Brand Equity?

Enhancing brand equity is an ongoing process that requires a strategic approach and continuous innovation. Here are some key strategies for elevating your brand's value and relevance in the marketplace.

Innovation and Adaptation

Innovation lies at the heart of brand growth and differentiation. By continuously innovating your products, services, and customer experiences, you can stay ahead of the competition and meet evolving consumer needs and preferences. Here's how you can foster innovation and adaptation:

• Research and Development (R&D) : Invest in R&D to develop new products or improve existing ones. Conduct market research , gather customer feedback , and stay abreast of industry trends to identify opportunities for innovation.
• Technology Integration : Embrace emerging technologies such as artificial intelligence , augmented reality, and the Internet of Things (IoT) to enhance product functionality, streamline processes, and deliver personalized customer experiences.
• Iterative Improvement : Adopt an agile approach to product development and iteration. Test and iterate on new ideas quickly, and make continuous improvements based on real-time data and insights.

Brand Extension Strategies

Brand extension involves leveraging your brand's equity and reputation to introduce new products or enter new market segments . When executed thoughtfully, brand extensions can capitalize on existing brand loyalty and associations to drive sales and expand your brand's reach. Consider the following brand extension strategies:

• Line Extensions : Introduce new variants or flavors of existing products to cater to different consumer preferences and occasions. For example, Coca-Cola offers Diet Coke, Coca-Cola Zero Sugar, and Coca-Cola Vanilla to appeal to diverse taste preferences.
• Category Extensions : Expand into related product categories that align with your brand's core values and target audience. For instance, Nike successfully extended its brand into apparel, accessories, and digital fitness platforms to offer athletes and fitness enthusiasts a comprehensive range of products and services.
• Co-Branding : Collaborate with other brands to create co-branded products or experiences that leverage the strengths and complementary attributes of each partner. Co-branded partnerships can help enhance brand visibility, reach new audiences, and generate buzz around new product launches.

Strategic Partnerships and Collaborations

Strategic partnerships and collaborations offer opportunities to amplify your brand's reach, relevance, and credibility through mutually beneficial relationships. By partnering with like-minded organizations or influencers, you can tap into new audiences, access new distribution channels, and leverage partner expertise.

• Influencer Partnerships : Collaborate with influencers or brand ambassadors who align with your brand values and resonate with your target audience. Influencers can help amplify your brand message, create authentic content, and engage their followers on social media platforms.
• Industry Alliances : Form alliances with other companies or organizations within your industry to share resources, knowledge, and best practices. Industry alliances can foster innovation, drive industry standards, and strengthen your brand's positioning as a thought leader and innovator.
• Cause Marketing Initiatives : Align your brand with social or environmental causes that resonate with your target audience's values. By supporting meaningful causes and giving back to the community, you can enhance your brand reputation, build customer loyalty, and differentiate your brand from competitors.

Continuous Brand Monitoring and Analysis

Continuous monitoring and analysis of brand performance are essential for identifying opportunities and threats to your brand equity. By staying vigilant and proactive, you can detect emerging trends, monitor competitor actions, and assess the effectiveness of your brand-building efforts.

• Brand Tracking Surveys : Conduct regular brand tracking surveys to measure brand awareness, perception, and loyalty among your target audience. Track changes in key brand metrics over time and compare your brand's performance against competitors.
• Social Media Listening : Monitor social media channels, review sites, and online forums to gauge consumer sentiment, identify emerging trends, and respond to customer feedback in real time. Social media listening tools can help automate data collection and analysis for more efficient monitoring.
• Competitive Analysis : Analyze competitor strategies, messaging, and market positioning to identify strengths, weaknesses, and opportunities for your brand. Stay informed about industry trends, new product launches, and competitive threats to adjust your brand strategy accordingly.
• Data Analytics : Utilize data analytics tools and platforms to gather insights from customer interactions, website traffic, and sales data. Analyze customer behavior, preferences , and purchase patterns to inform marketing decisions, personalize customer experiences, and optimize brand performance.

By embracing innovation, exploring brand extension opportunities, forging strategic partnerships, and adopting a proactive approach to brand monitoring and analysis, you can enhance your brand equity and position your brand for long-term success in the marketplace.

Examples of Successful Brand Equity Management

Examining case studies and real-world examples of brands that have effectively managed their brand equity can provide valuable insights and inspiration for your own brand-building efforts.

Apple Inc. is a multinational technology company known for its innovative products, including the iPhone, iPad, Mac computers, and Apple Watch. The company's brand equity is built on a foundation of innovation, design excellence, and a loyal customer base.

Brand Strategy:  Apple's brand strategy revolves around simplicity, elegance, and user-centric design. The company focuses on creating products that seamlessly integrate hardware, software, and services to deliver intuitive and delightful user experiences.

Key Success Factors:

• Product Innovation : Apple continuously pushes the boundaries of technology innovation with groundbreaking product releases and iterative improvements. The company's commitment to innovation ensures that its products remain at the forefront of consumer demand.
• Design Aesthetics : Apple's minimalist design aesthetic and attention to detail set its products apart in the marketplace. From sleek hardware designs to intuitive user interfaces, Apple prioritizes form and function to create products that are both visually appealing and easy to use.
• Brand Experience : Apple emphasizes the importance of the overall brand experience, from the moment customers interact with its products in-store to the seamless integration across devices and services. The company's retail stores serve as experiential hubs that showcase its products and provide personalized customer support.

Impact:  Apple's strong brand equity has translated into market leadership, premium pricing power, and unwavering customer loyalty. The company consistently ranks among the world's most valuable brands and continues to innovate and expand its product ecosystem to maintain its competitive edge.

The Coca-Cola Company is a global beverage company renowned for its iconic soft drink brand, Coca-Cola. With a history spanning over a century, Coca-Cola has established itself as one of the most recognizable and beloved brands worldwide.

Brand Strategy:  Coca-Cola's brand strategy centers on delivering moments of happiness and refreshment to consumers through its products and marketing campaigns. The company emphasizes universal values such as optimism, joy, and togetherness to connect with consumers across cultures and generations.

• Emotional Branding : Coca-Cola's marketing campaigns evoke emotions and nostalgia, fostering strong emotional connections with consumers. The brand's iconic advertising, such as the "Share a Coke" campaign and holiday-themed commercials, resonate with consumers personally.
• Brand Consistency : Coca-Cola maintains consistent branding across its product portfolio and marketing initiatives, reinforcing its brand identity and messaging. The company's distinct red and white color scheme, timeless logo, and signature contour bottle are instantly recognizable symbols of the brand.
• Global Reach : Coca-Cola's extensive global distribution network and localized marketing efforts enable the brand to reach consumers in diverse markets worldwide. Coca-Cola maintains relevance and resonance across cultures by adapting its messaging and products to local preferences and customs.

Impact:  Coca-Cola's brand equity extends beyond its core product to encompass a lifestyle and cultural phenomenon. The brand's ubiquitous presence, emotional resonance, and commitment to social responsibility have solidified its position as a global leader in the beverage industry.

Nike is a multinational corporation specializing in athletic footwear, apparel, equipment, and accessories. The brand is synonymous with sports performance, innovation, and inspiration, with a diverse product portfolio catering to athletes and fitness enthusiasts worldwide.

Brand Strategy:  Nike's brand strategy revolves around empowering athletes and inspiring individuals to reach their full potential. The company leverages the power of storytelling, celebrity endorsements, and innovative product design to connect with consumers and foster brand loyalty.

• Athlete Endorsements : Nike collaborates with elite athletes and sports personalities to endorse its products and embody the brand's values of determination, excellence, and perseverance. Celebrity endorsements, such as the partnership with basketball legend Michael Jordan, elevate Nike's brand image and resonate with consumers.
• Innovative Products : Nike invests heavily in research and development to develop cutting-edge technologies and materials that enhance athletic performance and comfort. Iconic product innovations like the Air Max cushioning system and Flyknit technology demonstrate Nike's commitment to innovation and excellence.
• Brand Purpose : Nike's brand purpose goes beyond selling products to inspire and empower individuals to pursue their passions and dreams. The company's marketing campaigns, such as "Just Do It," encourage consumers to push beyond their limits and embrace their inner athletes.

Impact:  Nike's brand equity is built on a foundation of performance, innovation, and inspiration. The brand's strong emotional connection with consumers, coupled with its relentless pursuit of excellence, has propelled Nike to the forefront of the athletic footwear and apparel industry, commanding premium pricing and brand loyalty.

Challenges and Risks in Managing Brand Equity

Managing brand equity comes with its own set of challenges and risks that businesses need to navigate effectively to maintain and enhance their brand's value and relevance in the marketplace.

• Brand Dilution : Expanding into new product categories or markets without proper alignment with the brand's core values and positioning can dilute the brand's identity and erode brand equity.
• Negative Publicity and Crisis Management : Public relations crises, negative media coverage, or social media backlash can damage a brand's reputation and erode consumer trust, leading to long-term consequences for brand equity.
• Competitor Actions and Market Dynamics : Intense competition, disruptive market forces, and shifting consumer trends can pose challenges to brand differentiation and market leadership, requiring businesses to adapt and innovate proactively.
• Consumer Perception and Shifts in Preferences : Changes in consumer preferences, values, and behaviors can impact brand perception and relevance, necessitating continuous monitoring and adjustment of brand strategies to stay aligned with evolving consumer needs.
• Lack of Brand Consistency : Inconsistent branding across different touchpoints and channels can confuse consumers and weaken brand identity, undermining efforts to build and reinforce brand equity.

Strategies for Employer-Employee Collaboration in Brand Equity Management

Effective collaboration between employers and employees is essential for fostering a brand-centric culture and maximizing brand equity. By aligning employee engagement with brand values and objectives, businesses can leverage their internal resources to strengthen brand equity.

• Internal Branding Initiatives : Educate and empower employees to become brand ambassadors by instilling a deep understanding of the brand's values, mission, and promise. Internal branding initiatives, such as brand workshops, training sessions, and employee handbooks, can help align employee behaviors and actions with brand principles.
• Employee Training and Engagement : Invest in employee training programs emphasizing the importance of delivering exceptional customer experiences and embodying the brand's values in every interaction. Foster a culture of open communication, recognition, and feedback to encourage employee engagement and commitment to the brand.
• Encouraging Brand Advocacy Among Employees : Encourage employees to share their positive experiences and insights about the brand on social media, review platforms, and industry forums. Recognize and reward employees who demonstrate exemplary commitment to upholding the brand's reputation and values.
• Cross-Functional Collaboration : Facilitate collaboration between different departments and teams to ensure alignment and consistency in brand messaging, customer experiences, and product offerings. Encourage cross-functional teams to collaborate on brand-related projects and initiatives to leverage diverse perspectives and expertise.
• Employee Feedback and Input : Solicit feedback and input from employees at all levels of the organization regarding brand strategy, product development, and customer interactions. Actively involve employees in decision-making processes and recognize their contributions to fostering a brand-centric culture.

By fostering a collaborative environment where employees are aligned with the brand's values and objectives, businesses can harness the collective efforts and enthusiasm of their workforce to strengthen brand equity and drive sustainable growth.

Conclusion for Brand Equity

Brand equity is the lifeblood of successful businesses, providing them with a competitive edge in the ever-evolving marketplace. By cultivating strong emotional connections, delivering exceptional customer experiences, and consistently delivering on brand promises, companies can build enduring relationships with consumers that transcend transactions. As we've explored throughout this guide, brand equity is not just a measure of financial worth; it's a reflection of the trust, loyalty, and perception of consumers towards a brand. However, managing brand equity is not without its challenges and risks. From maintaining brand consistency across various touchpoints to navigating crises and market dynamics, businesses must remain vigilant and proactive in protecting and enhancing their brand's value. By embracing innovation, fostering collaboration between employers and employees, and staying attuned to changing consumer preferences, businesses can navigate these challenges and position themselves for long-term success in the competitive landscape. Ultimately, brand equity is more than just a marketing buzzword—it's a strategic asset that fuels growth, inspires loyalty, and shapes the future of businesses around the world.

How to Easily Measure and Improve Brand Equity?

Introducing Appinio , your gateway to unlocking the power of real-time consumer insights to elevate your brand equity game. With our cutting-edge market research platform, you can now conduct your own comprehensive studies in minutes, revolutionizing the way you make data-driven decisions for your business.

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Rolex’s Brand Equity – Case Study #9

Do you know what is Brand Equity ? This is definitely what every brand that wants to grow on top of any market needs to seek.

In fact, brand equity is the combination of 5 components:

Brand Awareness

Brand association, perceived quality, brand loyalty.

• Proprietary Assets or Uniqueness

So for this week’s marketing case study, we will talk about one brand with powerful brand equity, I named Rolex !

What is Rolex?

Rolex is a watch manufacturer founded by Hans Wilsdorf. Yep, not “Hans Rolex” as you could have imagined!

Indeed, Wilsdorf registered the brand Rolex in 1908. He simply wanted a name that was easy to pronounce in any language. Also, the word Rolex was onomatopoeic, making a similar sound to a watch being wound (hmm). Finally, it was practical as the name was small enough to easily fit any watch face.

I believe that most of you have heard about Rolex, so I will not do you the insult to teach you the full story of Rolex during the last 100 years, but yet, here is some famous moment in Rolex’s history:

In 1926, Rolex developed the “Oyster”, the first waterproof wristwatch in the world.

In 1931, Rolex will change the face of the watch industry by creating the Perpetual Movement , a mechanism that doesn’t need to be manually rewound every day. Here, a little balance inside the mechanism uses the motion of the wearer’s wrist to create energy. A type of mechanism that you still see, nowadays, in automatic watches .

Even better, Rolex is a synonym for exploits!

In 1927, Mercedes Gleitze crossed the English Channel with her Rolex Oyster. The cross took 10 hours and the watch remained in perfect working condition.

In 1953, a new exploit for Rolex, their iconic Oyster Perpetual Explorer accompanied the British climber Edmund Hillary to the summit of Everest, the highest mountain in the world! Hillary & Rolex’s legend has just started…

I could keep going with Rolex going underwater, being part of the Pan American outfit, or accompanying American presidents for decades but it will never stop!

Let’s see how Rolex fits with the 5 points of Brand Equity.

As one of the leading luxury watch brands, Rolex is well-recognized among its potential customers. By sponsoring events or by using social media platforms to present the value of its wristwatches, Rolex connects with the people.

Also, as stated in the story of Rolex, the brand connects with extreme exploits but also with more “regular” sports competitions like the 24 Hours of Le Mans or as the official sponsor for the Women’s World Golf Rankings for example.

For a big brand like Rolex, it is mandatory to be associated with positive impact activities than just a large company working in factories…

In this regard, Rolex annually funds organizations like National Geographic to support aqua and nature conservation, wildlife protection, and other environmental causes and projects.

The brand association also goes on to the relation between Rolex and technological improvements like waterproof cases and resistance.

Rolex is not only about fit & finish but also about performance and stability.

Yet, the most important aspect of the Rolex brand is its empowerment value .

With its notorious long story of success and being worn by important people, Rolex became a synonym for success.

People purchase Rolex as a recognized symbol of success. (Even though watch lovers will tell you that a Rolex is just a first step and the real prestige comes from watches made by Vacheron Constantin, Audemars Piguet, etc)

In 2014, Rolex was in the second position as one of the most reputable brands in the world.

In fact, the level of trust from consumers is still really high and these ones still feel that keeping a Rolex watch is like offering a present to themselves.

There is an intense and strong emotional relationship between customers and the Rolex products.

Proprietary Assets

A brand like Rolex is not only defined by its history but also by its creations and then its proprietary assets like trademarks and patents.

This is necessary to keep your loyal customer base strong as they know they will never find the same exact product somewhere else.

In this case, Rolex sells its watches under registered iconic trademarks like:

• Oyster & Oyster Perpetual
• Crown Device

It took decades for Rolex to have its powerful brand equity at the level it is right now.

What to be learned?

When you start your brand, never forget what you want your company to be associated with. Splitting the brand equity into 5 points make it easier for you to prepare a full strategy by splitting the requirements for each point. Building brand equity takes time but it will be worth it as your customers will become your brand ambassadors with arguments to support you!

Check big brands and try to define what are their brand equities, you’ll be surprised.

Once again, if you need help with your digital marketing strategy, Krows Digital is here to help ! Also, you can have a look at past marketing case studies you may have missed here .

Have a great week and let’s do great marketing.

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Home / How to Build Insanely Good Brand Equity [Case Studies]

How to Build Insanely Good Brand Equity [Case Studies]

Ott heidmets.

Any brand strategy, whether it comes from a new or long-running company, has to be mindful of its effect on brand equity. We talked about its importance in advertising in our explainer of where the industry is heading at the moment, but we felt it was worth emphasising that people’s perception of a brand is important, but that perception is guided by actions. Here’s how to make your brand values talk to people, and keep your brand equity high.  

What Is Brand Equity?

Brand equity is the portion of a company’s value attributable to its brand(s), according to Brand Marketing Blog . In other words, a company with good brand equity can rely on its image among consumers being high before a product is released, and this can provide considerable protection from the slings and arrows of a difficult market.

So we can show you what makes good brand equity, we’ll take a look at a mainstream brand that has a high level of public goodwill, built up over many years – Apple. The technology company has now got up to the level of Rolex and Cola Cola in terms of the way its brand is regarded by the public at large, and in terms of its ubiquity in popular culture.

That level of global recognition, especially when it is overwhelmingly positive, is never easy to achieve, and so to give businesses something more achievable to aim for, we also want to highlight a smaller, newer company that is doing good work in marketing, product design, and customer satisfaction, and is being rewarded for it with great brand equity. That company is Dollar Shave Club, which you will probably have heard of if you’ve seen a YouTube ad in the past year or so.

Brand Equity Case Study #1: Apple

A brand with what seems like untouchably good brand equity is Apple. Their brand awareness is so wide that it is reckoned by Statista that the value of the Apple brand is around 300 billion US dollars . Whether you like or dislike the company itself, it’s indisputable that their brand identity is one of excellence in build quality, and the package they offer customers. How have they reached this point? It’s through years and years of perfecting their product, looking at what the competition does, and identifying how to do that better.

Remember Apple was once the company which struggled to replace the Apple 2 desktop computer, and which committed missteps like the Lisa tablet, something which was arguably before its time, but was heavy, bulky, and required a stylus for entering messages, unlike its distant descendant, the iPad.

How the company picked itself up and became stronger than ever is something detailed in the Walter Isaacson biography of Steve Jobs, and two movies about the Apple cofounder’s career.

[Not entirely related, but, if you’re interested, our opinion is that ‘Jobs’, starring Ashton Kutcher, was superficial and unsatisfying, while ‘Steve Jobs’, starring Michael Fassbender, is brilliantly scripted, but still a subtle fictionalisation of the protagonist’s interactions with others.]

To take the example of the smartphone market, Apple did not release the first touchscreen smartphone, but they did release what has become by far the global market leader, the iPhone. This took what people liked about their breakthrough handheld product, the iPod, and put it into a package with a big screen that could be tilted to landscape, a body that was reasonably resilient but still a slim, light, attractive design, and a camera that was, at the time, among the best on the market.

We’re seeing this again with the current trend for experimentation in the smartphone market: Apple is not averse to trying new things – in fact, they are known for it – but they’re rarely the first to try something. This is because they believe that it’s better to let other manufacturers try out design solutions that may or may not work, see what the flaws and successes are, and then build their own version that works well enough to preserve their reputation.

For Apple, brand equity comes in offering customers a product that works well straight out of the box, and has good reliability. It also comes in providing design that is clean, simple, and yet has enough unique identifiers that it seems desirable to consumers, meaning owners of it feel they have a certain social capital from using the product. If Apple released a poor-quality product, its brand equity would suffer; the key to maintaining brand equity is in keeping product quality high, bringing customer satisfaction.

Brand Equity Case Study #2: Dollar Shave Club

There are other, newer, smaller companies who have achieved great brand equity through similar means to Apple, but without the same behemoth scale.

One of these companies is Dollar Shave Club, a four-year-old company which has made its name through mail-order sales of razors and other shaving accessories. So far, so rudimentary? Well, yes, except that they offered to send monthly packs direct to customers’ doors for only $1 a month. As their CEO put it in a promotional video, “do you really want to pay $20 per month for branded razors, when 19 of those [dollars] go to Roger Federer?”

He was making his point in a jokey way, but somehow that fitted in with the image of the company. It was also a major contrast with other razor manufacturers’ ad campaigns, which could make you feel like you were watching the most serious thing in the world at times.  

The other thing that people like about the company is its customer service – packages routinely come on time, with special gifts and bonuses, while cancellation can happen at any time with no penalty fee – and the way it is often seen to be doing the right thing.

An example of this last point came when a US soldier in Afghanistan asked for an order for his company, and was told that he would be sent the packages, but that he wouldn’t be allowed by Dollar Shave Club to pay for them. The troops instead got free packages, along with a personal note from the CEO.

These things might seem like marketing ploys – and they are – but they also come from a basis of being honest with customers, not pulling any tricks, and not charging more than the company needs in order to make money. Put simply, this is a company that employs, and understands, Gen-Z consumers.

As we’ve explored in other articles, the new group of younger consumers appreciate authenticity as much as grand gestures, and from their rinky-dink, seemingly thrown-together ad (which is actually expertly scripted and choreographed), to their confidence in keeping their customer base through clear and honest communication, Dollar Shave Club seem rough-and-ready, and scrappy, but have a brand equity that was part of the reason for it being bought by Unilever for $1bn.

As part of their customer care programme, every Dollar Shave Club subscriber gets a monthly magazine in their package, and this also helps to build brand loyalty, and hence brand equity, as consumers look at the company and feel that whatever they do next, based on the evidence presented so far, will be good, and will be beneficial to the customer.

For anyone interested in brand building, this is a great case study in how to make consumers care about what you’re doing.

Want more tips on how to make people take notice of your brand? Here are some easy hacks!  

What Can We Learn from these Companies?

Brand equity is difficult to earn, and very easy to lose, particularly if a brand takes the loyalty of its customers for granted, and tries to circumvent rules that are there for everyone’s benefit. Neither of the companies we have profiled have done this – in fact they have spent years assiduously building their profile with consumers, not only through one-off campaigns, but through sustained hard work in appealing to, and broadening, their customer base.

It’s also important to note that both of the mentioned brands have achieved brand equity by understanding their core proposition, and what customers like about it, and by caring about product design, customer service, and continued excellence, enough to keep customers loyal.

If this were not the case, their brand equity would not be as strong as it is, because brand equity comes hand-in-hand with real-life brand performance, something you might think about the next time you see a premium brand licencing its name out to a less-than-premium product.

To find out about the state of advertising now, take a look at Nexd’s Digital Advertising Guide

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Brand Equity Explained: How to Maximize Your Business's Most Valuable Asset

In this comprehensive guide, we dive into the world of brand equity, its importance for businesses, and how to maximize its potential for your company's growth. Learn how to build, manage, and protect your brand equity through proven strategies, and explore the role of technology in brand equity management.

Brand Equity at a Glance

Brand equity refers to the perceived value a company gains from its brand name, which influences customers' purchasing decisions and loyalty. It comprises factors such as brand awareness, brand associations, perceived quality, and brand loyalty. A strong brand equity can lead to increased customer retention, higher profit margins, and greater marketing efficiency. To build and maintain brand equity, businesses should focus on creating consistent, high-quality experiences, fostering positive brand associations, and engaging with their target audience through multiple channels.

Brand Equity Explained:

• Introduction
• What is Brand Equity?
• The Benefits of Strong Brand Equity
• Factors Influencing Brand Equity
• Measuring Brand Equity
• Building Brand Equity: Strategies and Best Practices
• Managing and Protecting Brand Equity
• The Role of Technology in Brand Equity Management
• Case Study: Driving Business Value With Brand Equity

Before we continue, consider using our free Chat GPT-powered business case generator to see how measuring brand equity can drive success within your own organization...you might be surprised with the findings.

1. Introduction

Brand equity is a powerful force that can make or break a business. "When a company has positive brand equity, customers willingly pay a high price for its products," says Adam Hayes of Investopedia. It's a key determinant of a company's success, driving customer loyalty, purchase decisions, and long-term value. But what is brand equity, and how can you maximize its potential for your business's growth? In this article, we'll explore the ins and outs of brand equity, discuss its importance, and share strategies for building and managing this essential asset. By the end of this guide, you'll have a comprehensive understanding of brand equity and how to leverage it for your business's success.

2. What is Brand Equity? Introduction

At its core, brand equity is the value a brand adds to a product or service beyond its functional benefits. It's the sum of consumers' perceptions, experiences, and associations with a brand, which ultimately influences their behavior and loyalty. Per Marketing Evolution, 80% of consumers refuse to do business with a brand they don't trust . Brand equity comprises four primary components: brand awareness , brand associations, perceived quality, and brand loyalty.

Definition of Brand Equity

Brand equity is the added value a brand provides to a product or service in the eyes of the consumers. This value is based on the consumer's perception of the brand, shaped by their experiences and associations with it. A strong brand equity can lead to higher prices, customer loyalty, and overall business success.

Components of Brand Equity

Brand awareness : The extent to which consumers are familiar with a brand and can recall or recognize it. High brand awareness is crucial, as it's the first step in establishing a relationship with potential customers.

Brand associations : The mental connections and associations consumers make with a brand. These can be shaped by factors such as advertising, product packaging, and customer experiences. Positive associations can enhance brand equity, while negative associations can harm it.

Perceived quality : Consumers' overall perception of a brand's quality, based on their experiences and the brand's reputation. A high perceived quality can lead to higher prices and customer loyalty.

Brand loyalty : The likelihood that a customer will choose a brand over its competitors, based on their positive experiences and emotional connection to the brand. Loyal customers are more likely to repeat purchases and recommend the brand to others.

How Brand Equity Impacts Business Value and Growth

Strong brand equity can have a significant impact on a business's overall value and growth. When a company has a positive brand equity, it can enjoy benefits such as:

Increased customer loyalty: Customers are more likely to stick with a brand they perceive as valuable, leading to higher retention rates and long-term profitability.

Higher prices: Consumers are often willing to pay a premium for products or services from a brand they trust and perceive as high quality.

Easier market entry: A strong brand equity can make it easier for a company to introduce new products or enter new markets, as consumers are more likely to trust and try offerings from a well-known brand.

Competitive advantage: A robust brand equity can set a company apart from its competitors and help it gain market share.

Improved company reputation: A positive brand equity can enhance a company's overall reputation, making it more attractive to potential customers, employees, and investors.

3. The Benefits of Strong Brand Equity

A strong brand equity comes with numerous advantages that can propel a business to new heights. By understanding and leveraging these benefits, companies can create a competitive edge and enjoy long-term success.

Higher customer loyalty and retention . One of the most significant benefits of strong brand equity is increased customer loyalty. When consumers have a strong emotional connection to a brand, they are more likely to remain loyal, leading to higher retention rates. This loyalty can translate into a steady stream of revenue and increased profitability for the business.

• Increased customer lifetime value . Customer lifetime value (CLV) represents the total revenue a company can expect from a single customer throughout their relationship. Strong brand equity can lead to higher CLV, as loyal customers are more likely to make repeat purchases and recommend the brand to others. This, in turn, can boost a company's bottom line and long-term growth prospects.
• Greater pricing power and profitability . A well-established brand equity allows companies to charge a premium for their products or services, as consumers are often willing to pay more for a brand they perceive as high-quality and trustworthy. This pricing power can lead to increased profitability and financial stability for the business.
• Competitive advantage and market share growth . A strong brand equity can provide a company with a significant competitive advantage in its industry. Consumers are more likely to choose a well-known and respected brand over its competitors, leading to increased market share and overall business growth.
• Enhanced company reputation . Positive brand equity can bolster a company's overall reputation, making it more appealing to potential customers, employees, and investors. This improved reputation can lead to increased business opportunities, attracting top talent, and securing valuable partnerships.

Clearly, the benefits of building brand equity are immense as a part of a broader brand measurement strategy. Let’s next look at the things that impact brand equity.

4. Factors Influencing Brand Equity

Building and maintaining strong brand equity requires a strategic approach that considers various factors. By understanding these elements, companies can implement targeted strategies to strengthen their brand equity and reap the associated benefits.

• Consistent and compelling brand identity . A strong and consistent brand identity is crucial for establishing and maintaining brand equity. This identity includes visual elements such as logos and color schemes, as well as the brand's messaging and positioning in the market. By developing a compelling and cohesive brand identity, companies can create a memorable impression on consumers and foster positive brand associations.
• Quality of products or services . The quality of a company's products or services plays a significant role in shaping brand equity. High-quality offerings can lead to positive consumer experiences, enhancing perceived quality and brand loyalty. Conversely, poor-quality products or services can damage brand equity and deter potential customers.
• Customer experiences and satisfaction . Positive customer experiences can significantly impact brand equity. When consumers have enjoyable interactions with a brand, they are more likely to develop a strong emotional connection and become loyal customers. Companies can enhance customer satisfaction by providing excellent customer service, addressing concerns promptly, and exceeding customer expectations.
• Effective marketing and communication efforts . Marketing and communication efforts play a crucial role in building and maintaining brand equity. Through targeted campaigns, companies can raise brand awareness, shape brand associations, and reinforce their brand positioning. Successful marketing efforts can also help businesses connect with their target audience and foster loyalty.
• Corporate social responsibility and ethical practices . Today's consumers are increasingly concerned about the social and environmental impact of the brands they support. By engaging in corporate social responsibility (CSR) initiatives and adhering to ethical practices, companies can enhance their brand equity and appeal to a broader audience. Demonstrating a commitment to social and environmental issues can also help businesses stand out from competitors and gain a competitive edge.

Great, now we know what brand equity is, why it’s important and how to impact it. Next, let’s focus on how to measure brand equity.

5. Measuring Brand Equity

To manage and optimize brand equity, it's essential to measure its various components. A combination of quantitative and qualitative brand metrics can provide businesses with a comprehensive understanding of their brand's value and performance.

Quantitative metrics can help businesses assess the financial impact of their brand equity. Key indicators include revenue, profit margins, and market share. By monitoring these financial metrics, companies can gauge the effectiveness of their brand equity strategies and identify areas for improvement.

Qualitative measures offer insights into the more intangible aspects of brand equity, such as consumer perceptions and attitudes. Important qualitative metrics include brand awareness, brand associations, perceived quality, and brand loyalty. These metrics can be gathered through surveys, focus groups, and other research methods.

Various tools and methodologies are available to help businesses measure and analyze their brand equity. These can include brand valuation models, brand tracking studies , brand lift experiments , and brand health research . By utilizing these tools, companies can obtain actionable insights into their brand's performance and develop targeted strategies to strengthen their brand equity.

6. Building Brand Equity: Strategies and Best Practices

Developing strong brand equity requires a strategic and consistent approach. The following strategies and best practices can help businesses create a powerful brand presence and drive long-term growth.

• Developing a strong brand positioning and messaging . Effective brand positioning and messaging are crucial for establishing a unique and memorable brand identity. Companies should clearly articulate their value proposition, target audience, and competitive advantage to create a compelling brand narrative that resonates with consumers.
• Ensuring product and service quality. High-quality products and services are essential for building and maintaining strong brand equity. By focusing on continuous improvement and innovation, businesses can enhance their offerings and strengthen consumer perceptions of quality.
• Creating memorable customer experiences . Delivering exceptional customer experiences can foster loyalty and encourage positive word-of-mouth marketing. Companies should invest in customer service training, user-friendly digital platforms, and personalized interactions to create memorable experiences that keep consumers coming back.
• Leveraging integrated marketing communications . Integrated marketing communications (IMC) can help businesses create a cohesive and consistent brand presence across all channels. By coordinating messaging and visual elements, companies can reinforce their brand identity and ensure a seamless experience for consumers.
• Fostering brand advocacy and loyalty . Encouraging brand advocacy and loyalty can help businesses maximize their customer lifetime value and drive long-term growth. Strategies for building loyalty include creating loyalty programs, offering exclusive benefits to repeat customers, and engaging with consumers on social media.

7. Managing and Protecting Brand Equity

Once strong brand equity is established, it's essential to manage and protect it proactively. The following strategies can help businesses maintain their brand value and safeguard against potential threats.

• Regularly monitoring brand equity metrics . By regularly monitoring brand equity metrics, businesses can identify potential issues and address them promptly. This proactive approach can help companies protect their brand value and maintain a positive reputation in the market.
• Identifying and addressing potential threats to brand equity . Potential threats to brand equity can include negative publicity, poor customer experiences, or competitive pressures. Companies should have a crisis management plan in place to address such threats and minimize any potential damage to their brand equity.
• Implementing brand equity management processes . Implementing formal brand equity management processes can help businesses maintain a strong and consistent brand presence. These processes may include regular brand audits, brand strategy reviews, and employee training programs.
• Nurturing long-term relationships with customers and stakeholders . Building and maintaining strong relationships with customers and stakeholders can help businesses protect their brand equity. By fostering trust and loyalty, companies can create a supportive brand community that promotes long-term success.

8. The Role of Technology in Brand Equity Management

Technology plays a crucial role in building and managing brand equity in today's digital landscape. By leveraging innovative tools and platforms, businesses can enhance their brand presence and stay ahead of the competition.

Digital platforms such as websites, mobile apps, and e-commerce portals offer opportunities for businesses to create a consistent and engaging brand experience. By ensuring these platforms are user-friendly, visually appealing, and aligned with the overall brand identity, companies can strengthen their brand equity and drive customer loyalty.

Social media platforms provide an opportunity for businesses to interact with their audience, showcase their offerings, and build brand awareness. By utilizing social media effectively, companies can create a strong brand presence and foster positive associations with their brand. Additionally, online reputation management tools can help businesses monitor and respond to customer feedback, ensuring a positive brand image is maintained.

Data analytics tools can help businesses gain valuable insights into customer preferences, behavior, and sentiment. By analyzing this data, companies can make informed decisions about their brand strategy and optimize their marketing efforts for maximum impact.

9. Case Study: Driving Business Value Through Brand Equity

An online leader in higher education for health sciences professionals was facing increased pressure to hit enrollment goals given increased competition and declining numbers of high school graduates. The university was looking to understand how brand perceptions impacted its enrollment pipeline across its network campuses in multiple states to help determine how much of its marketing budget to allocate to brand-related strategies.

The university employed Brandata to study and help strengthen its brand equity to achieve significant enrollment growth. Brandata first developed and launched a brand tracking program with location-based quotas to create a detailed brand metric profile for each campus.

Next, Brandata compared brand metrics for each campus to its enrollment pipeline numbers using regression analysis and machine-learned modeling. The resulting analysis uncovered a relationship between brand positive, brand frequency and enrollment growth.

With these powerful insights in hand, the university’s media and creative agencies were able to make adjustments to the media plan and creative assets in order to impact brand sentiment, frequency and ultimately an increase in enrollment numbers.

This case study highlights the importance of a proactive and strategic approach to brand equity management. Businesses should regularly assess their brand performance, identify areas for improvement, and invest in initiatives that will strengthen their brand equity. By doing so, brands can enhance their business value and achieve long-term success.

10. Brand Equity, in Conclusion

Brand equity is a critical factor in determining a business's value and long-term success. By building strong brand equity, companies can enjoy numerous benefits, including higher customer loyalty, increased profitability, and a competitive edge in the market.

Investing in brand equity management is essential for businesses seeking to maximize their value and growth potential. By implementing the strategies and best practices discussed in this article, businesses can create a powerful brand presence that drives long-term success.

(Editor's note: this article was created and edited by the author using ChatGPT-4).

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Brand Equity

What is brand equity?

Components of brand equity, why is brand equity important, company examples with positive and negative brand equity, how to measure brand equity, how to build brand equity, build a brand customers love to reinforce brand equity, see how qualtrics strategic brand works, brand equity and how to build it.

20 min read Why are customers willing to pay higher prices for brand-name items over cheaper non-branded goods? Brand equity is the measure of the perceived worth of a brand-name product, and nurturing yours could help increase profit margins. Here’s how you can build brand equity in the eyes of those who matter most.

What really defines brand equity is the additional value that having a recognizable brand name adds to a product offering. So, what is brand equity? It’s that perceived quality that comes from brand awareness and reputation. It is a fierce driver of brand loyalty, and it can even determine the price – so building equity should be a key part of any good business strategy and marketing mix.

Other words that are used to describe brand equity are ‘sway,’ ‘good standing,’ or ‘commercial value’. Brand equity is also often linked to brand recognition , as a customer must be aware of the brand name initially, but it differs because brand equity emphasizes the added value that the brand name provides to the product.

Let’s take a look at an example. Pharmacies have many different varieties of Paracetamol available to buy. Some versions are pharmacy-owned brands, while others hold a recognizable brand name that the brand-owning company created.

Each Paracetamol product may have identical ingredients and produce the same outcome when used. Yet, some branded products may hold a stronger ‘standing’ (brand equity level) in the minds of the consumer. This higher level can be an influencing factor in the customer’s buying decision, meaning companies that own these brand-name products can gain an advantage in sales performance.

The brand-owning Paracetemol company, for example, can further capitalize on brand equity if it raises the purchase price of its product. The cost of production for a brand-name version and a generic non-branded version remains the same.

However, as the customer opts to pay extra for the branding in addition to the base product itself, the brand-owning company increases its profit margin and gains a stronger market share in the pharmaceutical industry.

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Brand equity is created as your customers become increasingly and more personally aware of your brand . They must first know that it exists, then form positive or negative opinions of it through their own interactions, and finally, arrive at a subconscious value they associate with your brand.

In that way, when you create brand equity, you’re adding to your overall brand health.

1. Brand perception

Brand perception is what customers believe a product or service represents, not what the company owning the brand says it does.

“Marketing managers spend 70 hours a week thinking about whatever product they are marketing, but the consumer is spending seven seconds,” says Professor Ravi Dhar of the Yale School of Management.

Those seven seconds in which a customer forms an impression of a brand can be influenced by marketing campaigns, slogans, or desired brand association, but at the end of the day, a consumer’s perception of a brand is something they create themselves.

This can happen during the following sub-stages:

Brand recognition

Brands have recognizable features that identify a product as belonging to a certain brand. An example would be the advertisements of McDonalds, which feature a specific logo , a consistent brand ambassador, and a love-it-or-hate-it catchy jingle.

The visibility of a brand has a large impact on our opinions – when a brand becomes a household name, the perceived value is higher. Consequently, the brand carries higher brand equity.

Brand awareness

Being aware of what the brand stands for (its unique selling point) can provide a level of familiarity and transparency that can impact a customer’s perception of a branded product.

For example, knowing the ins and outs of an iPhone and the Apple product range would provide more certainty and comfort when faced with an iPad over an Android phone. While brand recognition is about features, building brand awareness relies on the customer understanding more about your brand’s products, brand values , and brand image. Brand awareness is deeper than recognition, in other words, and it goes hand in hand with brand association – i.e. ‘I associate this brand with X characteristic’.

2. Positive or negative effects

The way a customer perceives a brand can directly impact their actions towards it. Their reaction will be subjective, and could be based on several factors:

Customer experience:

The positive user experience of a branded product can create a favorable impression of the brand. (You may now understand why Apple has so many Apple stores, where you can handle and use its full branded product line – and why they come preinstalled with easy-to-win games. Angry Birds anyone?)

The brand name is associated with a good supply chain, reputation, and trust level. LEGO Group has topped the list of the most reputable companies in the world repeatedly based on its performance across several reputation markers (products, governance, leadership, financial performance, how innovative they are, and their “citizenship”).

Customer preference:

Would a customer use the branded product themselves? The success of the sale relies on whether this brand represents the customer’s beliefs and values, and could easily feature within their life now.

Preferences could be because of more emotive reasons: UK cereal organization, Kellogg’s, was launched in the 1920s and engaged children with strong brand mascot characters on their packaging. Hence, customers who have grown up with Kellogg’s breakfast cereals will have strong associations with childhood and home.

When consumers react positively to a brand, they may buy the product and recommend the brand on social media, leading to increases in the brand-owning company’s reputation and bottom line. When a brand is perceived negatively, the customer’s reaction may be to boycott products, downplay, or criticize the product to others, which could lead to the opposite effect.

Managing brand equity is a driver of brand loyalty, then; people who make positive brand associations when they think of your company are more likely to become repeat buyers.

3. Resulting positive or negative value

The return from the effects of a positive or negative brand perception falls into two categories: tangible and intangible value.

• Tangible value is a result that can be easily measured and is often physical in nature. An example of positive tangible value is increased revenue due to a greater number of sales. An example of negative tangible value could be a decrease in company stock price value as a result of a loss of confidence in the product’s ability to sell.
• Intangible value is a result that can’t be tracked or replicated easily and isn’t physical in nature. Positive intangible value could be gained with greater brand awareness and goodwill or through word of mouth. Negative intangible value could be the perception of a brand as dangerous or as being in bad taste.

Managing brand equity is a hugely important part of any company’s success because it represents the overall value and reputation of the brand.

Having a positive brand reputation makes it easier for a company to attract new customers and retain existing ones, since customers are more likely to choose a company with a strong brand reputation, and are also more likely to pay a premium for products or services from a well-known and trusted brand. Brand equity can also differentiate your company’s products or services from your competitors. So investing in building and maintaining strong brand equity can help you increase your chances of long-term success – but how do you calculate the ROI of your brand equity efforts?

As with any ROI calculation that looks at a single part of brand-building efforts, it’s tricky to attribute exact growth to exact measures. Ultimately though, the most important thing is to look at industry trends to see the value that a strong brand can create. Branding, and brand value, represent some 20% of the value of the entire S&P 500 , while 77% of consumers are likely to refer to certain items by brand names, rather than product names.

Consistent presentation of a brand, meanwhile, can increase revenue by 33% – meaning that time and money spent on building your brand equity can pay big dividends.

In general, strong brand equity leads to increased customer satisfaction and loyalty, the ability to demand a higher price, and a greater share of voice across every channel and platform, all of which can help drive revenue.

The benefits of developing your brand equity

You can develop greater market share: In some saturated industries, your brand needs to stand out and appeal to customers through your unique selling point or distinct branding. Developing your brand equity will give you a competitive edge in the marketplace. When you can be remembered by a customer at a point of sale, then you have given yourself a greater chance of successfully selling your product.

You can charge a price premium: The price premium – also known as relative price – is the percentage that a product’s selling price exceeds or falls short of a benchmark price (in this case, the market average for a product). When you have better brand equity, you’re able to charge more for the product and increase your price premium percentage over the market average. This can be a good overall metric to measure your product’s financial performance.

You can extend your product line easily: When you have a high level of brand equity, customers will be more likely to continue their business with you and be the first to try any new products and services. You could ask your community of customers for testers at the product development stage, or launch directly into the market for customers to buy.

You have a greater impact as a company: With your increased revenue and market dominance, you may find yourself in a powerful situation. You can use your high brand equity to form new partnerships, look around for better supplier rates, or be considered worthy of a ‘seat at the table’ with other large brands. This could open the door to collaborations, business ventures, or investment opportunities that would otherwise not be available to you.

Some products or services fall in and out of positive or negative brand perception, which then creates corresponding positive or negative actions and value results:

The Coca-Cola Company

The Coca-Cola brand is worth an estimated $271 billion and sells in every country of the world (aside from Cuba and North Korea!).

It is consistently adapting to suit its customers’ lives, with past products offering label personalization for younger audiences, creating Christmas advertising featuring a Santa in a red suit to welcome in the holidays, and past taglines emphasizing positive experiences: “Make it real” (2005), “Open happiness” (2009) and “Taste the feeling” (2016).

Great brand equity means that a company can add to its product range within the brand, safe in the knowledge that customers will trust the brand enough to try the new products. Coke was able to do this through product expansion – and today they own over 20 brands.

WW (formerly Weightwatchers)

A word of caution to those of you that think changing your brand is easy. There have been some examples of companies that have faced backlash and negativity when trying to make a positive change.

In 2008, the dieting company then called Weightwatchers rebranded to try to focus on general wellness and self-care, by dropping the word ‘weight’ from their name and adding the tagline: ‘Wellness that works’.

While WW was reacting to the changing times, a backlash against their changes caused negative customer experiences and took its toll on their share price. To restore their lost brand awareness and recognition, WW soon changed its approach and became ‘Weight Watchers Reimagined’.

There are three core brand equity drivers that you need to track when measuring brand equity: financial, strength, and consumer metrics:

Financial metrics

The C-suite will always want to see a positive balance sheet to confirm that the brand is healthy. You should be able to extrapolate from the data market share, profitability, revenue, price, growth rate, cost to retain customers, cost to acquire new customers , and branding investment. You can use solid financial metrics data to demonstrate how important your brand is to the business and secure higher marketing budgets to continue growing.

Strength metrics

Strong brands are more likely to survive despite change and deliver more brand equity. You’ll need to track awareness and knowledge of the brand, accessibility, customer loyalty , retention , licensing potential, and brand ‘buzz’. Also, monitor social media and survey the public to get a picture of how your brand is known and loved (or not).

Consumer metrics

Companies don’t build brands; customers do. You must track consumer purchasing behavior and sentiment toward your brand. Track and measure brand relevance, emotional connection, value, and brand perception through surveys and social media monitoring. The right text analytics software that can interpret open text comments is particularly useful to gather sentiment and suggestions.

Measuring brand equity is an ongoing challenge. The aim is to make practical changes that fuel positive associations for your customers, measure the change, and then repeat the process.

Brand equity is the value of your brand for your company. It’s based on the idea that a recognized brand that’s firmly established and reputable is more successful than a generic equivalent. It’s also based on customer perception: customers will tend to buy a product they recognize and trust. When a brand is recognized and trusted to the point that the customer recognizes it and feels a deep psychological bond with it, your brand equity is valuable indeed.

So how do you build positive brand equity? What are the practical steps you can take to garner high brand equity and that greater sense of perceived quality?

Here are four brand management tactics that can help shape your ongoing brand equity model:

1. Build greater brand awareness

You need to make sure your customers recognize your brand identity when they’re looking for goods or services, and that they perceive it in the way you intend. There are several ways you can do this:

• Using the same logo or image to ensure your branding is consistent
• Great customer service
• A heart-warming story behind the brand
• Keeping the brand in front of your market
• Providing ongoing value
• Keeping in touch via email or newsletters
• Tap into social media and share more – blogs, tweets, Facebook groups, Instagram photos
• Word of mouth, positive customer experience, and targeted marketing all help you develop greater brand awareness.

2. Communicate brand meaning and what it stands for

Consider how well your product meets the needs of customers — not just the physical ones, but their social and psychological needs as well. A company that produces a useful product, and genuinely commits to social or environmental responsibility will attract customers and employees who share those values and who will be sufficiently connected and enthusiastic to be advocates.

IKEA, for example, has invested in sustainability throughout its entire business operation: 50% of its wood is from sustainable sources, 100% of its cotton is Better Cotton standard and 700,000 solar panels power its stores. With feel-good eco-credentials like these, spending a Sunday afternoon assembling an IKEA flat pack seems more of a pleasure.

3. Foster positive customer feelings and judgments

When customers have a positive impression of your product, they’re more likely to become loyal customers and pass the word on. Judgments are made about a brand’s credibility, capability, quality, relevance to need, and superiority over the competition, so it’s important to maintain the integrity of all these things. Positive feelings can be excitement, fun, peer approval, security, trust, and self-respect, to name a few.

A brand that can maintain positive judgments and feelings is a winner. For example, the iPad: did you think you needed one before you saw one and appreciated its capabilities? For many of us today it’s our computer, gaming console, TV, radio, alarm clock, mobile bank, and messaging service… we love our iPads.

4. Build a strong bond of loyalty with your customers

Brand loyalty is a powerful, yet very difficult, aspect of brand equity to attain. Loyal customers are customers that have formed a psychological bond with your brand. They make repeat purchases. They may feel like they’re part of a community of fellow consumers.

They will act as your brand ambassadors, inadvertently selling your products for you through social media, online forums, and even physical events. Establishing a brand equity connection that borders on customer evangelism is an invaluable part of brand management.

People shop more with brands they’ve had great experiences with. In fact, some 73% say that the customer experience is an important part of their future purchasing decisions . Customer satisfaction breeds customer loyalty, referrals, lifetime value, and positive brand equity. So really, the best way to build brand equity is to employ a brand strategy that puts customers at the heart of your business.

Technology can make this daunting task easier by automating the jobs that enterprise-scale makes impossible to do manually, intelligently monitoring what customers are saying, and finding parts of the customer journey that are currently letting your customers – and your brand ,by extension – down.

In other words, the right technology under your belt can help you manage and measure brand equity, build brand loyalty, and improve consumer perception.

Software like Qualtrics Brand Experience Management platform can turn your customers into fans by listening to feedback across every touchpoint as well as intelligently monitoring the customer journey on a person-by-person level to identify gaps in their experience that need closing.

BrandXM™ knows which parts of those experiences are hurting your brand – the ones that drive negative brand equity – and which ones are helping it flourish in the minds of consumers. And, crucially, it can proactively suggest exactly what to do to quash the former and squeeze even more from the latter.

By working 24/7 to deliver best-in-class customer experiences, you’ll create positive brand associations and boost your brand’s perceived quality. And that’s what powers a brand’s equity and grows market share at the same time.

Related resources

Brand research 14 min read, brand value 7 min read, customer-based brand equity models 10 min read, brand equity research 5 min read.

Market Segmentation

Market Fragmentation 9 min read

Brand Perception

Brand Sentiment 18 min read

Brand intelligence 12 min read, request demo.

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Brand equity retention after rebranding: a resource-based perspective

• Original Article
• Published: 28 November 2021
• Volume 29 , pages 208–224, ( 2022 )

Cite this article

• Rian Beise-Zee   ORCID: orcid.org/0000-0003-2759-4825 1  

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In recent decades, the substitution of corporate brand names has been spurred by mergers, acquisitions, and corporate spin-offs. When a business unit is divested, brand equity must be transferred from an established brand name to a new brand name. The central research question addressed in this study is how a spin-off retains brand equity after rebranding. The study is based on a case study of the divestment and rebranding of a subsidiary of a multinational firm. A thematic analysis is conducted based on semi-structured in-depth interviews and archival data of the rebranding campaign. The case analysis grounds brand equity retention after rebranding in the resource-based theory. The findings indicate the perceived continuation of the spin-off’s intangible, tangible, and relational resources as the primary condition under which the spin-off retains the brand equity associated with the former parent company’s corporate brand name. This central insight raises theoretical and practical implications for the conceptualization of brand equity and brand names and the value of brand names. The ability of a brand entity to rebrand suggests that the value of a brand name can be based on the replacement costs of a brand name instead of the entire financial value of brand equity.

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Beise-Zee, R. Brand equity retention after rebranding: a resource-based perspective. J Brand Manag 29 , 208–224 (2022). https://doi.org/10.1057/s41262-021-00263-5

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Home » Management Case Studies » Case Study: L’Oreal’s Customer- Based Brand Equity (CBBE) Model

Case Study: L’Oreal’s Customer- Based Brand Equity (CBBE) Model

Customer-Based Brand Equity is defined as the differential effect that brand knowledge has on consumer response to the marketing of that brand. The Customer-Based Brand Equity Model approaches brand equity from the perspective of the consumer — whether this be an individual or an organization. Understanding the needs and wants of consumers and organizations and devising products and campaigns to satisfy them are at the heart of successful marketing.

BRAND SALIENCE:

Created in France, L’Oreal Paris brings the sophistication and elegance derived from its French heritage to women and men all over the world. L’Oreal Paris offers leading-edge products that out-perform the competition to people who care more about the way they look. Our passion for innovation, performance, style and a sense of premium is encapsulated in the ‘because you’re worth it’ philosophy. Our core values are supported by our strong investment in scientific research and technology.

Over a third of the L’Oreal Group’s total turnover in this country is generated by L’Oreal Paris, making it the company’s largest division in the UK. Today there are strongly established L’Oreal Paris brands across all of the key areas of the beauty market, including the Plenitude skincare range, Elvive haircare and Studio Line styling products. Other brands include L’Oreal Paris Colour Cosmetics, Elnett, Rcital, Excellence, Fria, Perfect Blonde, Open, Casting and L’Oreal Kids.

BRAND PERFORMANCE:

Branding Strategy of L’Oreal has enabled the company to spread its’ business not only in Europe but also in Asia and Latin America. In the year 2005, the Brand L’Oreal was ranked first among all the cosmetics companies of the world.

L’Oreal Branding Strategy has achieved success throughout the world. Over the years, the company is successfully producing and selling different cosmetic products, haircare and skincare products in almost 150 countries of the world. This has been possible because of the well established Brand Name and Brand Image of L’Oreal.

L’Oreal has been successful in generating a worldwide Brand Identity only because of the company’s powerful and efficient Branding Strategy. This successful Global Branding Strategy of L’Oreal helped the company to earn significant levels of revenue in the past years In the year 2005, L’Oreal was valued as a $18.89 billion company. In 2004, total value of the L’Oreal Brand was $5902 million. In 2003, the company recorded a value of $5600 million.

In fact, from the year 1989, the Brand L’Oreal experienced continuous growth. The company recorded double digit growth rate in consecutive years and in the year 2005, it became the largest cosmetic company of the world.

BRAND IMAGERY :

L’Oreal has been one of the most reputed brands in the cosmetics field. The brand has made its presence felt in more than 100 countries, thanks to its numerous acquisitions worldwide. With several brands in its kitty, L’Oreal has carved a niche for itself with its unique strategies and stands out from the other cosmetics brands. The L’Oreal group develops several important communication  campaigns every year that underline the ability and the growth of the group. It is omnipresent across several media channels and the constant presence enables the brand to retain its reigning position in the market despite stiff competition from numerous cosmetic brand. The commercial communication of the group is made at a world level. The group proposes the same products and leans on the same advertising campaigns. In that case, visuals are the same, the text identical, the slogan is unchanged, and the ads are only translated with respect to countries. However, in spite of its global presence, the group realized that it could not sell the same product to all its consumers. The group knew how to diversify towards American, Asian or Latin brands.

BRAND JUDGEMENT

Few of the women in the admiring crowd realize that the trendy ”New York” Maybelline brand belongs to French cosmetics giant L’Oreal. In the battle for global beauty markets, $12.4 billion L’Oreal has developed a winning formula: a growing portfolio of international brands that has transformed the French company into the United Nations of beauty. Blink an eye, and L’Oreal has just sold 85 products around the world, from Redken hair care and Ralph Lauren perfumes to Helena Rubinstein cosmetics and Vichy skin care.

Thanks to this strategy, masterminded by L’Oreal Chief Executive Lindsay Owen-Jones, the French company has not only enjoyed a decade of double-digit growth but has pioneered new ground rules for staying on top in a fiercely competitive industry. L’Oreal’s net profits rose 12% in 1998, to $768 million, while its stock has soared 900% in the ’90s.

L’Oreal’s success is proof that when done right, global branding can speed growth in mature consumer-products companies even when global markets themselves are shaky. Asia’s economy is a mess, Latin America is lottery. Other worldwide marketers, such as Procter & Gamble Co., are suffering partly as a result. But L’Oreal is surging in markets stretching from China to Mexico. Its secret: conveying the allure of different cultures through its many products. Whether it’s selling Italian elegance, New York street smarts, or French beauty through its brands, L’Oreal is reaching out to more people across a bigger range of incomes and cultures than just about any other beauty-products company in the world. That sets L’Oreal apart from one-note marketers such as Coca-Cola Co., which has just one brand to sell globally.

L’Oreal’s strategy positions it beautifully to profit even further when the middle class begins to grow again in emerging markets . Says Veronique Adam, analyst at J.P. Morgan Securities Inc. in Paris: ”L’Oreal is the only real global leader in every segment of the industry.”

For Owen-Jones, the trick will be staying ahead in the game as his powerful rivals seek to play the global branding game. From giant P&G to niche players such as Los Angeles-based cosmetics maker Stila, L’Oreal’s competitors are hustling to catch up. ”L’Oreal want to become more of a global company like L’Oreal,” says Yoshikuni Miyakawa, a general manager of the cosmetics-marketing division of Shiseido Co., Japan’s No. 1 cosmetics company. Already, Shiseido is dominant at home and now expanding around the world. Meanwhile, the French company is No. 10 in Japan, trailing rivals such as Clinique and Estee Lauder.

BRAND FEELINGS:

It is customers emotional responses and reaction with respect  to the brand. “L’Oreal” formed in France, Paris, brings the sophistication and elegance consequent from its French heritage to women and men all over the world. L’Oreal Paris offers leading-edge products that out-perform the competition to people who care more about the way they look. The passion for innovation, performance, style and a sense of premium is sum up in the customers money spending worth and also it’s’ philosophy. The core values are supported by strong investment in scientific research and technology.

The L’Oreal Group total turnover by the Paris franchise making it the company’s largest division in the world. Today there are strongly established L’Oreal Paris brands across all of the key areas of the beauty market, including the Plnitude skincare range, Elvive hair care and Studio Line styling products. Other brands include L’Oreal Paris Color Cosmetics, Elnett, Rcital, Excellence, Fria, Perfect Blonde, Open, Casting and L’Oreal Kids. The Consumer Products Division in the Europe is dedicated to offering consumers innovative, high technology beauty products from global brands at competitive prices. This is delivered through a global strategy combined with a local understanding of the needs of women and men of all ages.

BRAND RESONANCE:

The L’Oreal Group has three international brands named as L’Oreal Paris, Garnier and Maybelline that offer hair care, sun care, hair coloring, skin care and make-up products. All of these available from mass market retail outlets such as supermarkets, drugstores and leading chemists throughout the world. L’Oreal Paris remains the finest mass-market brand. It is offering consumers reachable luxury for skin care through providing its consumers leading-edge products that outshine the competition. “Garnier”, on the other hand, Europe’s no1 brand for natural beauty products in hair care category that offers a complete collection for healthy hair. Similarly, Maybelline offer world class quality for on screen requirements. The L’Oreal Group performance is marvelous due to its distribution channel too. The company focuses on “go native” strategy mean hire local firms in every country to distribute its products. Secondly, “First landing” strategy that is first commercialization is bad thing if the product is not available in a particular place. It has two bad impacts on the company: one would be if product is not at a particular place and company runs there commercials the negative word-of-mouth generate due to the consumers effortless struggle to search the product. The other is the huge advertising budget shatter due to pointless direction. The company by itself monitor, control and evaluate its channel performance especially distributors. The company follow same marketing mix for the whole world with a little bit variation according to the economic conditions of a certain country. L’Oreal is known for its strong control over its promotion, place, price and packaging strategy, which is decided from the headquarters. For these points, only minor product adaptations are made in different countries such as labels’ languages. All controls are very frequently checked to comply with prices and selling places of the group marketing strategy .

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Please note you do not have access to teaching notes, linking brand personality to brand equity: measuring the role of consumer-brand relationship.

Journal of Indian Business Research

ISSN : 1755-4195

Article publication date: 13 September 2021

Issue publication date: 16 November 2021

This study aims to examine the relationship between brand personality and customer-based brand equity (CBBE) by investigating the mediating role of consumer-brand relationship (CBR), which is represented through three variables, namely, brand trust, attachment and commitment.

Design/methodology/approach

This study adopts a cross-sectional descriptive research design. It included a mix of symbolic and utilitarian brands, namely, Pepsi and Sprite (soft drinks), Levi’s and Peter England (clothing), Pantene and Head and Shoulders (shampoos) based on their greater familiarity among Indian consumers. Primary data were gathered from 612 respondents through a self-administered online questionnaire survey approach. Structural equation modeling was performed to analyze data and validate the research model.

The present study establishes both direct, as well as the indirect linkage between brand personality and CBBE. Results also suggest a partial mediating role of the variables representing CBR while linking brand personality to CBBE.

Originality/value

The present study makes two contributions. First, it advances existing literature on brand personality and brand equity by establishing the mediating role of the CBR while linking brand personality to CBBE. Second, it establishes the importance of both the trust and attachment-based commitment mediator model of CBR influencing CBBE, which has not been addressed by prior studies.

• Brand trust
• Consumer-brand relationship
• Brand personality
• Brand attachment
• Brand commitment
• Customer-based brand equity

Ahmad, A. , Swain, S. , Singh, P.K. , Yadav, R. and Prakash, G. (2021), "Linking brand personality to brand equity: measuring the role of consumer-brand relationship", Journal of Indian Business Research , Vol. 13 No. 4, pp. 586-602. https://doi.org/10.1108/JIBR-01-2021-0017

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Impact of Perceived Product Value on Customer-Based Brand Equity: Marx’s Theory – Value-Based Perspective

Yonggang qiao.

1 School of Marxism, Suqian University, Suqian, China

2 School of Art and Media, Suqian University, Suqian, China

3 School of History and Culture, Harbin Normal University, Harbin, China

Associated Data

The original contributions presented in this study are included in the article/supplementary material, further inquiries can be directed to the corresponding author/s.

Management research is allocating energies to seek ways to improve organizational performance. Branding has become a significant phenomenon that academicians and scholars have studied. Improving the brand’s overall equity requires strategies that the brand managers must implement. Based on Marx’s theory, the present study attempts to determine the role of product perceived value on customer-based brand equity, brand resonance and customer affective commitment, respectively. Moreover, this study also tries to determine the mediating roles of brand resonance and customer affective commitment in the relationship between product perceived value and customer-based brand equity, respectively. For this purpose, the data were gathered from 310 customers of branding products in China. The present study applied partial least square structural equation modeling for empirical analyses using Smart PLS software. The present study’s findings acknowledge that product perceived value did not directly influence customer-based brand equity. However, results confirmed that product perceived value positively influences brand resonance and customer affective commitment. Furthermore, the outcomes of the present study also concluded that both brand resonance and affective commitment played a mediating role between product perceived value and customer-based brand equity, respectively. Theoretically, the study contributed to the literature by examining the influence of product perceived value on customer-based brand equity. The study also enriched the literature by providing key findings related to the mediating roles of brand resonance and customer affective commitment. Practically, the study is beneficial for the brands and they can enhance product perceived value by improving product design, effectively communicating product benefits, and executing effective promotional strategies.

Introduction

Brands have played a significant role during the frenzy of acquisitions and mergers since the late 1980s. In the recent decade, brand valuation has shifted from developed economies to emerging economies which has changed the branding question considerably ( Barros-Arrieta and García-Cali, 2021 ). In the present era of global marketing, branding strategy has become a significant indicator of the marketing mix and this factor is considered a key to achieving sustainable competitive advantage ( Keller, 2021 ). Moreover, branding decisions have become a crucial factor for global marketing as the marketing managers are striving to capitalize the brand equity into reputable brands in the new economies. Globally, the efforts of the marketing managers can be seen in how they attract the attention of the customers and how well they build customer equity ( Ruiz-Real et al., 2020 ).

Recently, studies in the discipline of customer-based brand equity have suggested a shift from measuring and conceptualizing the construct to examining the relationship with other concepts in the marketing domain ( Surücü et al., 2019 ). Brand equity is a significant concept in the marketing-business practice and academic research as marketers can build strong brands and gain a competitive advantage ( Keller, 2021 ). Customer-based brand equity is composed of five dimensions i.e., brand awareness, brand association, brand loyalty, perceived quality, and other proprietary assets ( Cambra-Fierro et al., 2021 ). A brand’s customer-based brand equity is measured on the basis of how positively they react to a brand’s element of the marketing mix as compared to the same element of the marketing mix for other similar brands. Customer-based brand equity takes place when customers recognize the brand and possess strong, favorable, and unique perceptions about the brand. According to Hyun et al. (2022) , customer-based brand equity is derived from brand value and brand strength. Brand value is gained through high future and current profits and brand strength is the association of the brand held by its customers. The confidence of the customers placed in the brand generated higher customer-based brand equity. This confidence allows the customers to become loyal and willing to pay a higher price for the brand products ( Stocchi et al., 2020 ).

Brand equity is measured by three factors i.e., uniqueness, perceived quality/perceived value, and willingness of the customers to pay the high price ( Tuncer et al., 2020 ). This suggests that perceived value is an integral component of customer-based brand quality. Product perceived value is one of the categories of consumer behavior. It is the evaluation or subjective judgment of the customers toward the product and the benefits received by buying the product ( El-Adly, 2019 ). Product perceived value influences both purchase decisions and brand cognition of the customers. The perceived value is highly dependent on the benefits offered to the customer as the higher the benefits are, the more perceived value will be developed among the customers ( Wang et al., 2019 ). Product perceive value is not related to the product price as cost-effective products can have higher perceived value if those products can solve customers’ problems effectively and quickly. In addition, there are mainly two dimensions of product perceived value i.e., perceived acquisition value which focuses on the gains received from the products. The other dimension of the perceived transaction value relates to the psychological pleasure or satisfaction of the customer after purchasing the product ( Slack et al., 2020 ). Product perceived value is a significant construct in consumer behavior literature as it influences other consumer behavior aspects. For example, Chen and Lin (2019) suggested that perceived value directly impacts the repurchase intentions of the consumers. This indicates that perceived value is a factor that must be highly considered by the marketers and the organizations.

Brand resonance is referred to as the relationship between the brand and its customers including the willingness of the customers to buy and recommend the band to others ( Duman et al., 2018 ). It is also how they perceive the value and goals of a particular brand. The experiences of the customers with the brand have the power to build a stronger brand resonance. The brand generally adds value to its products so that the consumers like the brand add develop repurchase intention toward the brand. Product evaluations developed by the brands help the customers to understand the brand, especially those products that are complex and manufactured by foreign companies not known to local consumers ( Cheng et al., 2019 ). In other words, brand loyalty and equity are highly influenced by brand resonance. Brand resonance consists of four main aspects i.e., a sense of community, behavioral loyalty, active engagement, and attitudinal attachment ( Husain et al., 2022 ). In order to develop brand resonance, consumers have to use the products of the brands more frequently and pay high attention to the information related to the brand to form a strong psychological engagement with the brand ( Lithopoulos et al., 2021 ).

Customer affective commitment is developed as a result of the passionate connection of the customers with the brand that demonstrates personal identifications ( Farid and Niu, 2021 ). Both mutual value and identification are closely related to affective commitment. Khraiwish et al. (2022) opined that affective commitment is deeply rooted in the attachment of the customers with the brand. Putting differently, the emotional attachment of the brand is also known as affective commitment. The consumers who are genuinely committed to the brand have an emotional attachment to the brand, thus the affective commitment is higher among these customers ( Iglesias et al., 2019 ). In the literature, affective commitment has two dominant co-dimensions, i.e., continuance commitment and normative commitment. Both of these dimensions strongly impact the attitudes of the consumers. When customers experienced high affective commitment, they remain attached to the brand ( Jaiswal and Dhar, 2016 ). Customers who have a high affective commitment not only become loyal to the brand but also tend to show repurchase behavior. Research shows that affective commitment of the consumers toward a brand is established as a result of high service or product value. Moreover, developing affective commitment require time as it builds over time. However, affective commitment has a long-term effect on the brands’ performance ( Rather et al., 2019 ).

Wang et al. (2008) examined the factors of customer-based with product-market outcome approaches with brand resonance and quality perception as mediators. The authors suggested that future studies must analyze the determinants of brand equity such as perceived value in the existing model. Moreover, only a handful of studies have empirically analyzed the relationship between perceived value and customer-based brand equity. In addition, limited studies showed the factors affecting customer-based brand equity. Scare literature is available with regards to the mediating effect of brand resonance. Considering these shortfalls, the present study aimed to examine the role of product perceived value on customer-based brand equity with the mediating role of brand resonance. Moreover, Mbango (2018) analyzed the influence of customer satisfaction on repurchase intention with the mediation of affective commitment. The researchers argued that affective commitment must be studied with other variables related to new branded products. Therefore, the current study incorporated customer affective commitment as a mediator in the relationship between product perceived value and customer-based brand equity on branded products.

Based on the gap found in the literature, the present study postulated some objectives which are: to examine the impact of product perceived value on customer-based brand equity, to analyze the effect of product perception on brand resonance, and to determine the impact of product perceive value on customer affective commitment. The study has two mediating variables i.e., brand resonance and customer affective commitment, so the study has formulated the objective based on these constructs. The objectives are: (1) to investigate the mediating role of brand resonance in the relationship between product perceive value and customer-based brand equity and (2) to analyze the mediating role of customer affective commitment in the relationship between product perceive value and customer-based brand equity.

The current study also posited the research questions which have been addressed. The research questions are: what is the impact of product perceived value on customer-based brand equity? What is the effect of the product perceived on brand resonance? And what is the impact of product perceived value on customer affective commitment? The study has two mediating variables i.e., brand resonance and customer affective commitment, so the study has formulated the questions on the basis of these constructs. The research questions are: does brand resonance mediate the relationship between product perceived value and customer-based brand equity and does customer affective commitment mediate the relationship between product perceived value and customer-based brand equity?

Review of Literature and Hypotheses Development

The study was conducted in China and the data was acquired from the customers who purchase branded products. This research intends to analyze the role of product perceived value and customer-based brand equity with the mediations of brand resonance and customer affective commitment. To address the objectives of the study, the study established the hypotheses which are based on the following theory.

Marx’s Theory

Marx’s theory was developed by Marx in 1954 as a critique of the school of human relations. According to this perspective, organizations are not the rational system to perform work efficiently, rather organizational systems are power systems designed for the maximization of profits and control. Marx’s value-based perspective consists of two dimensions i.e., the sphere of production and the sphere of circulation. These spheres focus on the process of capital accumulation. According to Marx, there are three core values in the organizational context, i.e., use value, exchange value, and value. Use value is defined as the physical or other characteristics of a product that induce the demand for that product. It is the product utility. Exchange value highlights the monetary value given by the individuals in exchange for the product. It is the money from value. Value is referred to as the labor time embodied in the product. According to Marx’s perspective, value is socially necessary for provoking benefits for the organization ( Bowman and Toms, 2010 ).

Considering the framework of the study, product perceived value impacts customer-based brand equity, brand resonance, and customer affective commitment with the mediations of brand resonance and customer affective commitment. The relationship between the variables has been borrowed from Marx’s theory which points out that value are a significant facet of building an organization. The value-based perspective highlights the importance of value provided by the organization either use value, exchange value, or value. This theory is deeply rooted in the framework of the study (see Figure 1 ).

Theoretical framework.

Relationship Between Product Perceived Value and Customer-Based Brand Equity

Perceived value is the key facet and is regarded as an important factor of most customer-based brand equity frameworks ( Surücü et al., 2019 ). Product perceived value mainly focuses on the assessment of the customer with regards to the utility of the brand on the basis of their perceptions of what they have received in terms of satisfaction and quality and what they have given in terms of money and other non-monetary costs. Perceived value is considered a significant aspect that leads toward customer-based brand equity ( Wu et al., 2020 ). Perceived value includes experiential, functional, and symbolic attributes and functions. Moreover, scholars argued that perceive value includes perceived quality in such a way that when perceived quality is high, consumers develop high perceived value ( Kim et al., 2021 ). Therefore, perceived quality is included in the judgment of perceived value.

Perceived value plays a significant role in building brand equity because customers need high value from the products. Customer-based brand equity consists of five major determinants, i.e., value, commitment, trust, social image, and performance. These determinants contribute greatly to developing customer-based brand equity. For example, Iglesias et al. (2019) undertook a study to examine the role of customer satisfaction, commitment, and brand experience on customer-based brand equity and found that these factors positively affect customer-based brand equity. Perceived value and customer-based brand equity are closely related because one of the dimensions of customer-based brand equity is product value ( Dian et al., 2021 ). The product value offered to the customers by the brands can either increase or decrease the brand equity such that if the product value is high, brand equity will increase ( Armawan, 2021 ). From the point of view of the customers, brand equity is the value offered to the target customers ( Gallart-Camahort et al., 2021 ). Aaker’s model highlights the brand value and brand equity to measure and modularizes the overall brand equity. This model also suggests that product value is a significant component of brand equity and these constructs are gelled together ( Ertemel and Civelek, 2020 ). Customer-based brand equity (CBBE) significantly contributes to the overall success of the brand. Ruan et al. (2020) opined that customer-based brand equity is developed as a result of perceived value because when the products offer high value to the customer, the brand equity increases. Moreover, studies also pointed out the fact that brand equity is an intangible factor that is based on the judgment and measurement of the perceived value ( DAM, 2020 ). Moreover, perceived value can be explained as the difference between the total product value and total product cost. The total product value is the benefits acquired by the customers from the product and the total product cost is the energy time and money given by the customer during the purchase. If the total product value is higher than the total product cost then the product’s perceived value is high ( Lee et al., 2020 ).

Few studies have been conducted to understand how perceived value impacts customer-based brand equity. For example, Yan and Yan (2019) studied the influence of customer perceived value on brand equity. The results showed that all three types of values (i.e., emotional value, functional value, and cost) have a positive effect on brand equity among customers in China. Jahanzeb et al. (2013) also examine the impact of service quality on brand equity with the mediations of perceived value and corporate credibility. The findings revealed that service quality positively influences brand equity and both perceived value and corporate credibility mediate the relationship. These findings showed that perceived value has a positive association with brand equity. Although few studies have examined the relationship between product perceived value and customer-based brand equity, still this relationship is not extensively tested and this further validation is required. Based on the above discussion, the following hypothesis is formulated:

• H 1 . Product Perceived Value has a positive association with Customer-Based Brand Equity.

Relationship Between Product Perceived Value and Brand Resonance

( Keller, 2021 ) explained that brand resonance in terms of the association between the brand and its customers that brand resonance develops when the consumers sense the brand and establish emotional resonance with the brand. The four components of brand resonance are behavioral loyalty, attachment, sense of community, and active engagement. Loyalty indicates the value received by the customers which in turn develops customer buying behavior ( Duman et al., 2018 ). This signifies that value is deeply associated with brand resonance. In addition, the relationship between perceived value and brand resonance can be explained through customer experience. The brand experience emphasizes the depth of the psychological bond which is built through the high perceived value of the product ( Cheng et al., 2019 ). A pleasant experience creates brand awareness and enables the consumers to make a purchase decision and develop brand resonance.

Perceived value influences customer satisfaction such that when the customers receive high value from the product, they get satisfied. This satisfaction then leads to brand resonance. In this regard, ( Jang et al., 2021 ) claimed that perceived value maximizes the satisfaction of the customers which in turn helps to build brand resonance. Moreover, ( Khan et al., 2022 ) empirically tested the relationship between brand relationship quality and utility value on brand resonance using social exchange theory among Halal food consumers. The results confirmed that utility value has a positive association with brand resonance and brand relationship quality mediated the relationship. Moreover, from the consumer’s perspective, product value increases due to product utilization which leads to better performance of the product ( Hwang et al., 2018 ). A study conducted on product quality and brand loyalty showed that higher quality leads to high brand loyalty ( Husain et al., 2022 ). It indicates that utility value positively impacts brand loyalty and perceived value leads to long term bond of the customer with the brand. Thus, perceived value has a strong association with brand loyalty which is one of the dimensions of brand resonance.

The value offered to the customer builds brand image and reputation which consequently impacts brand resonance ( Wang and Lin, 2021 ). The customers also require brand knowledge so that they can relate to the brand and understand what the brand offers. High-quality products offered to the customer develop high perceive value among the customers because quality matters to a greater extent when it comes to purchasing decisions ( Lithopoulos et al., 2021 ). Additionally, brand resonance is particularly associated it how the consumers relate to the brand. If the value of the products is high, only then the consumers can relate and develop a positive perception of the brand. Only a few studies have examined the relationship between perceived value and brand resonance. For example, ( Wang and Lin, 2021 ) examined the relationship between experiential value, celebrity endorsement, and brand resonance. The study confirmed that experiential value is associated with brand resonance through celebrity endorsement. Very scarce literature is available that explained the relationship between product perceived value and brand resonance. There is a need to analyze this association. Therefore, the present study aimed to address this gap in the literature, and posited the following hypothesis:

• H 2 . Product Perceived Value has a positive impact on Brand Resonance.

Relationship Between Product Perceived Value and Customer Affective Commitment

Customers make a purchase decision on the basis of their evaluation in terms of how good their experience was with the brand ( Gallart-Camahort et al., 2021 ). For example, if the product’s perceived value was high, they regard it as a pleasurable and satisfactory experience. In addition, when the experience of the customers with the product outperforms their experience, they perceive that product to have high value ( Farid and Niu, 2021 ). Customers build a positive attitude toward the branded product if the product performance is higher than expected. This attitude enables the customers to purchase branded products ( Khraiwish et al., 2022 ). Moreover, customers provide their judgment of the product based on the overall quality and the value obtained from buying the product. The products that have high quality and value are preferred by the customers as a result they show repurchase behavior ( Husain et al., 2022 ). However, poor quality and low-value products of the brand are not only disliked by the customers but the customers tend to show a negative attitude toward the brand.

High product perceived value tends to contribute to the future commitment of the customers to the brands ( Servera-Francés et al., 2019 ). Products with high value make the customer committed to the brand. Prior studies have shown that evaluation of the customers regarding product value based on their consumption experience leads to affective commitment ( Kungumapriya and Malarmathi, 2018 ). A high level of product value is closely related to a strong relationship with the brand. In addition, customer affective commitment has a strong association with a brand’s performance ( Molinillo et al., 2021 ). The marketing literature showed that customers with high perceived value show a high level of brand loyalty which in turn influences customer affective commitment ( Wu et al., 2020 ). This commitment enables the consumers to provide positive recommendations and referrals about the brand. Therefore, it becomes significant for the brand to deliver high-quality and high-value products to the customers, so that the brand can be benefited in the long run.

Kungumapriya and Malarmathi (2018) opined that affective commitment is developed as a result of brand loyalty because loyalty has been conceptualized as the strong commitment of the customers to repurchase the product. According to Servera-Francés et al. (2019) , customers develop a positive attitude, such as affective commitment and brand loyalty, toward a particular brand if the brand provides high-value products. The relationship between product perceived value and customer affective commitment has not been widely explored. However, few studies have linked these variables through a third construct. For example, Roy et al. (2022) investigated the influence of customer experience and customer affective commitment among Australian retailers. The authors claimed that customer experience is positively associated with affective commitment and this experience gets pleasant with high perceived value. Similarly, Itani et al. (2019) analyzed the association of perceived value and product quality with customer engagement. The findings confirmed that perceived value and product quality have a significant relationship with customer engagement. These results indicate that perceived value is also positively associated with customer affective commitment. Based on the above discussion, the following hypothesis has been proposed:

• H 3 . Product Perceived Value has a positive impact on Customer Affective Commitment.

Mediating Role of Brand Resonance

Brand resonance is referred to as the relationship between the brand and the customer that includes the willingness of the customer to purchase or recommend the brand to others. The perception of the customers about the brand is built through their experiences and learning about the brand and what value they offer to the customers ( Jang et al., 2021 ). Therefore, brands add value to the products by delivering meaning, and customers like brands as they package the meaning ( Cheng et al., 2019 ). Product value significantly impacts brand resonance because when the customer receives highly valued products, they can relate to the brand. Put differently, brands can attract customers by providing products with a high value which leads to brand equity ( Kang et al., 2021 ). Additionally, Jang et al. (2021) claimed that perceived value maximizes the satisfaction of the customers which in turn helps to build brand resonance. These studies justify that brand resonance can be a mediator in the relationship between perceived value and brand equity.

One of the core dimensions of brand equity is brand loyalty, and brand loyalty is built when the customer can relate to or resonate with the brand ( Husain et al., 2022 ). This resonance is deeply linked with perceived value because customer needs are fulfilled when they receive high valued products ( Lithopoulos et al., 2021 ). Scholars argued that perceived value has a positive relationship with brand resonance and customer-based brand equity; therefore, brands that want to enhance brand resonance and CBBE must deliver high-value products ( Kang et al., 2021 ). Brand resonance can help predict brand equity, future revenues, and firm value in competitive business markets. Brands win customers because they develop a deep relationship with the customers through different factors. In a sense, to develop this relationship brands deliver products that exceed the expectations of the customers ( Rather et al., 2019 ). Branding marketing is deeply rooted in what the brand offers to the customers and how the customers perceive those products.

The mediating role of brand resonance has been explored in a few studies only. For instance, Khan et al. (2022) examined the mediating role of brand resonance in the relationship between quality and utility value among food consumers. The results confirmed that brand resonance is a significant mediator between quality and utility value. The researchers discussed that quality products enhance brand resonance which consequently maximizes utility value. A recent study by Duman et al. (2018) also determined the influence of affective factors on brand equity with the mediation of brand resonance among Turkish visitors. Duman et al. (2018) discussed based on the results obtained that affective factors significantly impact brand equity and brand resonance fully mediated the relationship. Husain et al. (2022) empirically tested the influence of brand experience on brand trust with the mediating effect of brand resonance. This study also showed that brand resonance mediated the relationship between brand experience and brand trust. On the basis of the above discussion and past literature, the author developed the hypothesis mentioned below:

• H 4 . Brand Resonance positively mediates the relationship between Product Perceived Value and Customer-Based Brand Equity.

Mediating Role of Customer Affective Commitment

In the marketing literature, customer affective commitment plays a key role as it is a major determinant of influencing the brands ( Syed and Shanmugam, 2021 ). Scholars argued that customer affective commitment is directly related to customer-based brand equity ( Zang et al., 2021 ). For example, Poushneh et al. (2019) found that affective commitment reduces the switching behavior and prevents the customers to search for alternative brands ( DAM, 2020 ). The switching behavior can be decreased with the high perceived value gained by the customer after purchasing the products from a particular brand ( Armawan, 2021 ). Customers with low switching intentions show high commitment to the brand, thus enhancing brand equity. This traditional understanding of affective commitment as a behavior for the repurchase of a product constitutes brand equity. Customers call for high valued products and this perceived value then leads to affective commitment. Putting differently, customers build a positive attitude toward the branded product if the product performance is higher than expected.

More recently, scholars recognize affective commitment as a significant factor for the brands as it induces customer desire to recommend the brand to peers ( Farid and Niu, 2021 ). The preference of the customer for one brand over others and affective commitment leads to higher brand equity and brand success. Scholars also argued that affective commitment is one of the dimensions of brand equity ( Iglesias et al., 2019 ). Moreover, academicians also proposed that affective commitment and attachment with the brand are dimensions of customer-based brand equity. Brands consider commitment as an internal brand strength that can induce brand equity ( Slack et al., 2020 ). Furthermore, brand equity is conceptualized as a measure of the strength of customer commitment to a brand. In this regard, Wang et al. (2008) claimed that affective commitment can be developed in customers with high product perceived value.

Among the scant literature available relating to customer affective commitment as a mediator, Rather et al. (2019) found that customer affective commitment mediated the relationship between customer word-of-mouth and customer involvement. Jeon and Yoo (2021) also examined the association of perceived value and customer engagement through the mediation of affective commitment. Based on the results of the study, the authors concluded that perceived value significantly impacts customer engagement and affective commitment, and affective commitment facilities the relationship among the customer of the hotel industry. Finally, Syed and Shanmugam (2021) analyzed the influence of corporate social responsibility on word-of-mouth with the mediating effects of affective commitment and customer trust. The empirical evidence revealed that affective commitment and customer trust fully mediated the relationship between corporate social and word-of-mouth. In line with the scant literature and aiming to gain further insights into the mediating role of affective commitment in the relationship between product perceived value and customer-based brand equity, the author proposed that:

• H 5 . Customer Affective Commitment positively mediates the relationship between Product Perceived Value and Customer-Based Brand Equity.

Based on the above discussion and the literature, the authors developed the following conceptual framework (see Figure 1 ):

Research Methods

Study design.

This study aims to identify the effect of product perceived value on customer-based brand equity through the mediating role of brand resources and customer affective commitment. Hence, the present study data was gathered from consumers of various branded products in China. In this regard, the authors visited different brand outlets to seek permission for data collection from the customer. For this aim, they met with outlet managers, conveyed the complete data collection objective, and assured them that data would be collected only for educational purposes. The authors also guided the managers regarding the importance of the practical implication of the study for whom data would be collected. So, they also assured them that the practical implication would be shared upon their request. Hence, managers showed a positive response and were permitted to collect data.

The authors developed self-administrated questionnaires based on a cover letter for data collection. This cover letter conveyed the whole objective of data collection to the participants as this study helps the organizations ensure better services and products based on customers’ views. Moreover, through the cover letter, it was also conveyed that no answers are right and wrong as their true answers would help in generating natural outcomes for this study. Hence, this step boosts the confidence of the customers to get as natural as possible responses. The questionnaire was first developed in English and then translated into Chinese as English was not common in China for speaking and reading. Hence, the authors developed dual-language questionnaires to ease the customers’ understanding. Translation of questionnaires was completed under the guidance of senior researchers. As per their guidance, the author also collected sample base data from students on dual language questionnaires for language proficiency examination. In this way, all errors and corrections were made, and the senior researchers approved finalized questionnaire.

The authors adopted a convenient sampling technique for data collection from customers. They took two weeks for data collection and personally visited different brand outlets and gave approximately 8 h a day to collect data. They also requested all the visitors and customers of different outlets for questionnaire filling and offers soft drinks to customers to fill out the questionnaires. In this way, the authors targeted 350 customers and got back 350 questionnaires. After confirming their completeness and validness, they finalized 310 responses for data analysis. Hence, this study’s empirical analyses are based on a 310 sample size.

The present study participants’ responses were measured based on five points Likert scale. This scale has five numbers where 1 represents “strongly disagree,” 2 represents “disagree,” 3 represents “neutral,” 4 represents “agree,” and 5 represents “strongly agree.” This study assessed data from previously validated items. The construct perceived product value was measured with five items scale adapted from Agarwal and Teas (2001) . The construct brand resource was measured with six items scale adapted from Wang et al. (2008) . The construct of customer affective commitment was measured with a five-items scale adapted from Dean (2007) . The construct customer-based brand equity was measured with four items scale adapted from Boonghee et al. (2000) . All variables items are presented in Appendix 1 .

Assessment of Measurement and Structural Model

The present study applied the variance-based partial least squares structural equation modeling (PLS-SEM) technique instead of other co-variance-based techniques such as AMOS. The basic purpose behind this selection is the effectiveness of PLS-SEM for both types of studies (confirmatory and exploratory) ( Hair et al., 2011 ). Structural equation modeling (SEM) consists of two different types, which include covariance-based (CB-SEM) and PLS-SEM. The key difference in both methods is that CB-SEM is considered for theory acceptance and rejection, while PLS-SEM is considered for advancing and developing the theories ( Avotra et al., 2021 ; Nawaz et al., 2021 ; Yingfei et al., 2021 ). PLS-SEM is an appropriate approach for complex and multi-orders-based models and needs no specific data normality conditions. PLS-SEM is also useful for evaluating small data sets ( Hair et al., 2016 ). Hence, the present study considers the PLS-SEM method for empirical data analyses using Smart PLS 3.3.3 software. The outcomes of PLS-SEM-based analysis are evaluated in two stages, including model measurement and structural model evaluation. The measurement model stage assesses the reliability and validity of the constructs, whereas the structural model analyzes the relationship between the proposed hypotheses. The acceptance or rejection of a hypothesis is determined through the t statistic and p values.

The results of model measurement consist of two parts: model reliability and validity. The present study considered the values of “Cronbach’s alpha, roh-A, composite reliability, and average variance extract (AVE)” to approve the model’s reliability ( Hair et al., 2016 ), and all values are presented in Table 1 . The values of Cronbach’s alpha are accepted if they are greater than 0.7 ( Hair et al., 2019b ). In the same way, the composite reliability value should also be greater than 0.7. The Cronbach’s alpha values of models’ constructs (brand resonance, customer affective commitment, customer-based brand equity, and product perceived value) are 0.895, 0.872, 0.849, 0.884 and the composite reliability values of models’ constructs are 0.920, 0.907, 0.896, and 0.915, respectively. All values of Cronbach’s alpha and composite reliability are according to acceptable criteria, which confirm the model’s reliability in the present study. The values of roh-A reliability (0.899, 0.874, 0.863, 0.886) are also according to acceptable criteria ( Hair et al., 2019b ). The average variance extract (AVE) values greater than 0.5 are considered appropriate for the model’s convergent validity ( Hair et al., 2011 ). The Table 1 illustrates that the AVE values (0.658, 0.662, 0.684, and 0.684) are according to acceptable criteria.

Reliability and convergent validity of the study constructs.

PPV = Product Perceived Value, CBBE = Customer-Based Brand Equity, BR = Brand Resonance, CAC = Customer Affective Commitment.

Table 1 reported that the current study model is based on 20 items of the four variables. According to acceptable criteria, the outer loading values greater than or equal to 0.7 are considered reliable for the model’s validity ( Hair et al., 2019b ). Figure 2 depicts that the outer loading values of all items are according to the acceptance criteria. One item (BR6) shows the outer loading value of 0.699, which is below 0.7 but retained because this item did not affect the AVE value. The variance inflation factor (VIF) values are also displayed in Table 1 . The VIF values are evaluated to verify the collinearity issues in the model. The model is considered free from the collinearity problems if the VIF values are reported below 0.5 ( Hair et al., 2019b ). According to the outcomes presented in Table 1 , the VIF values are less than 0.5, such as the variable “customer-based brand equity” item CBBE-3 has the highest VIF value (3.488). Hence, it is proved that there are no collinearity issues in the current study model ( Hair et al., 2016 ).

Output of measurement model. PPV = Product Perceived Value, CBBE = Customer-Based Brand Equity, BR = Brand Resonance, AC = Affective Commitment.

The R 2 values are measured to describe the model’s strength, such as the values of latent variables exceeding or near 0.5, which indicates moderate strength of the model, and the values near 0.25 show weak model strength ( Hair et al., 2017 ). The R 2 values of endogenous variables of the present study’ model (Brand Resonance, Affective Commitment, Customer-Based Brand Equity) are 0.479, 0.293, and 0.402, respectively, which shows moderate model strength ( Hair et al., 2019a ). The cross-validated redundancy (Q 2 ) values of the model are considered significant if they are larger than zero ( Hair et al., 2017 ). The Q 2 values of all latent variables of the current study are greater than zero, which validates the significance of the model.

The two well-known approaches, namely, Fornell–Larcker criterion and Heterotrait–Monotrait (HTMT) ratios, are used to evaluate the discriminant validity of the current study ( Hair et al., 2011 ). The Fornell-Larcker criterion is evaluated by taking the square roots of AVE values of model constructs ( Hair et al., 2014 ). The Forenell-Larcker criterion values of variables are presented in Table 2 . The values under the Forenell-Larcker criterion are accepted if the upper side first value of each column is highest than their below values. Table 2 shows that all values of the Forenell-Larcker criterion are as per the accepted criteria. Thus, it is confirmed that discriminant validity based on the Fornell-Larcker criterion has been achieved in this study model. In addition, according to the given criteria, the HTMT values of all constructs should be less than 0.85; however, values greater than 0.90 are also considerable ( Nawaz et al., 2019 ; An et al., 2021 ; Xiaolong et al., 2021 ). According to the outcomes of the present study, the HTMT values of constructs are less than 0.85, which confirmed that discriminant validity in the present study’s model has been established ( Table 3 ).

Discriminant validity (Fornell-Larker-1981 Criteria).

Discriminant validity (HTMT).

Hypotheses Analysis

Direct effect.

The empirical investigation of the current study was accompanied by using a bootstrapping approach through 5000 samples with replacements to measure the significance level. The direct, indirect, and total paths are presented in Table 4 . The present study considered the “ t ” values and “ p ” values of statistics for the acceptance or rejection of the hypotheses. The current study hypothesis results are shown in Table 5 . According to hypothesis 1, product perceived value positively impacts customer-based brand equity; however, the outcomes ( t = 0.350, p = 0.726) depicted product perceived value does not positively impact customer-based brand equity. Hence, the first hypothesis of this study is rejected. The outcomes ( t = 12.876, p = 0.000) of hypothesis 2 confirmed that the product’s perceived value positively impacts brand resonance, which means the second hypothesis of the present study is accepted. In addition, the beta value of hypothesis 2 revealed that one unit change in the independent variable (Product Perceived Value) would result in 0.692 changes in the dependent variable (Brand Resonance). According to the results (t = 6.714, p = 0.000) of the third hypothesis, product perceived value positively impacts customer affective commitment, confirming that the second assumption of the present study is accepted. In addition, the beta value of H3 showed that one unit change in the independent variable (Product Perceived Value) would result in 0.541 changes in the dependent variable (Customer Affective Commitment).

Direct, indirect and total path estimates.

Hypotheses testing (Direct Effect).

Indirect Effect/Mediation

The present study also considered the mediating role of brand resonance and customer affective commitment between product perceived value and customer-based brand equity, respectively ( Figure 3 ). For the empirical investigation of brand resonance and customer affective commitment as mediators, this study assumes hypotheses 4 and 5 ( Table 6 ). The present study used the variance accounted for (VAF) approach to indicate the mediation level. The values of VAF greater than 80% show full mediation, values between 20 and 80% show partial mediation, and values less than 20%. The results of hypothesis 4 revealed that H4 is accepted, and the VAF value (57.21%) shows partial mediation. According to the outcomes, hypothesis 5 of the present study is also accepted, and the VAF value (48.75%) shows partial mediation.

Structural model bootstrapping. PPV = Product Perceived Value, CBBE = Customer-Based Brand Equity, BR = Brand Resonance, AC = Affective Commitment.

Hypotheses testing (Mediation).

In this turbulent era of competition, organizations seek ways to enhance performance and be more competitive in markets. Boukis and Christodoulides (2020) point out that higher brand equity is a constructive indicator of future success and the long-term sustainability of the firms. Customer-based brand equity is a phenomenon that has become the point of attention from various researchers and scholars worldwide ( Yan and Yan, 2019 ). Studies have been initiated to investigate how customer-based brand equity can be developed and enhanced. However, there is a dearth of knowledge concerning the various antecedents and predictors of brand-based equity. Based on Marx’s theory, the present study attempts to determine the role of product perceived value on customer-based brand equity, brand resonance and customer affective commitment, respectively. Moreover, this study also tries to determine the mediating roles of brand resonance and customer affective commitment in the relationship between product perceived value and customer-based brand equity, respectively.

The outcomes of the present study depicted that hypothesis 1 (product perceived value has a positive impact on customer-based brand equity) is not accepted, which means that the product perceived value does not have a positive association with customer-based brand equity online. However, these results are not consistent with prior studies ( Surücü et al., 2019 ; Yan and Yan, 2019 ), as these studies claimed that perceived value is the key facet and is regarded as an important factor in most customer-based brand equity frameworks. Moreover, the present study’s findings confirmed that product perceived value positively impacts brand resonance and customer affective commitment, respectively, which means that hypotheses 2 and 3 are accepted. These findings are consistent with the findings of Roy et al. (2022) , as they acknowledged that customers’ brand experience has a critical role in building their affective commitment, and this experience gets pleasant with high perceived value. Similarly, these findings are also confirmed by Kungumapriya and Malarmathi (2018) . From their point of view, affective commitment is developed due to brand loyalty because loyalty has been conceptualized as the strong commitment of the customers to repurchase the product. The reason is the benefits associated with the product perceived value to the customers of the brands.

The findings of hypothesis 4 revealed that brand resonance positively mediates the relationship between product perceived value and customer-based brand equity. Khan et al. (2022) also confirmed that brand resonance is a significant mediator between quality and utility value. Additionally, the results are consistent with the findings obtained by Husain et al. (2022) . They empirically tested the influence of brand experience on brand trust with the mediating effect of brand resonance and found that brand resonance mediated the relationship between brand experience and brand trust. Brand resonance is developed when the brand provides high valued products to the customers, consequently impacting customer-based brand equity.

The findings of hypothesis 5 confirmed that customer affective commitment positively mediates the relationship between product perceived value and customer-based brand equity. Jeon and Yoo (2021) also found that customer affective commitment plays a constructive role in strengthening the relationship between product perceived value and customer-based brand equity. Binu Raj (2021) concluded that perceived value significantly impacts customer engagement, and affective commitment and affective commitment facilitate the relationship among the customer of the hotel industry. Similarly, Slack et al. (2020) also revealed that brands consider commitment as an internal brand strength that can induce brand equity. Affective commitment is developed as a result of perceived value and this, in turn, influences customer-based brand equity.

Theoretical and Practical Implications

This research study contributes in the body of literature in several significant ways. Existing research depicts that there are limited literature exists which explore the predictors of consumer-based brand equity ( Mbango, 2018 ). Moreover, only a handful of studies have empirically analyzed the relationship between perceived value and customer-based brand equity. In addition, limited studies showed the factors affecting customer-based brand equity. Khan et al. (2022) suggest that future studies must analyze the predictors of consumer-based brand equity ( Ertemel and Civelek, 2020 ). Thus this study extends the limited literature of consumer-based brand equity by exploring some key predictors of consumer-based brand equity. In addition to this, literature reveals that very scare literature exists which explore the mediation effect of brand resonance. Considering these shortfalls, the present study aimed to examine the role of product perceived value on customer-based brand equity with the mediating role of brand resonance. Moreover, there was a paucity of research with regards to how brand resonance and affective commitment mediate the relationship between perceived product value and customer-based brand equity ( Iglesias et al., 2019 ). This study successfully bridged this gap by establishing the indirect effects of brand resonance and affective commitment. It was established that both brand resonance and affective commitment are important factors that indirectly influence the development of customer-based brand equity.

Moreover, analyzed the influence of customer satisfaction on repurchase intention with the mediation of affective commitment. The researchers argued that affective commitment must be studied with other variables related to new branded products. Therefore, the current study incorporated customer affective commitment as a mediator in the relationship between product perceived value and customer-based brand equity on branded products.

The results of this study also yield some important practical implications. It becomes imperative for the branding and marketing managers of various brands to undertake efforts and implement strategies to enhance the perceived value of their product offerings. The enhancement of perceived value will lead to the development of positive behavioral outcomes such as an increase in customer-brand-based equity. Some of the ways in which product perceived value can be enhanced include: improving product design, effectively communicating product benefits, and executing effective promotional strategies. Moreover, the marketing managers and organizations should also focus on enhancing brand resonance and affective commitment of the customers toward the brand. To achieve this, the organization should focus on establishing brand awareness and developing strong relationships between the organization and its customer base. This can be achieved by providing exceptional customer service and by implementing high values of transparency and customer-centricity.

Limitations and Recommendations

Like other studies of social sciences, the current study also has some limitations, which may motivate scholars to conduct the research in the future. The sample size of this study was small and hence the results may not be generalizable; future studies may enlarge the sample size to enhance the reliability of the results. This study is conducted on Chinese customers only; future studies may expand the scope to other regions to enhance the reliability of the results. Moreover, a cross-sectional design was adopted by the present study. Future researchers should adopt a longitudinal design by acquiring data over multiple time intervals to enhance the credibility of the results. This study analyzed the impact of product perceived value on customer-based brand equity through the mediating mechanisms of brand resonance and affective commitment. Future studies should introduce other mediating variables such as perceived brand image, customer engagement, and brand awareness to broaden the understanding of the various antecedents and predictors of customer-based brand equity.

In this era of competition, firms are seeking ways to enhance performance and be more competitive in markets. Customer-based brand equity is a phenomenon that has become the point of attention for various researchers and scholars worldwide. Studies have been initiated to investigate how customer-based brand equity can be developed and enhanced. However, there is a dearth of knowledge concerning the various antecedents and predictors of brand-based equity. Based on Marx’s theory, the present study attempts to determine the role of product perceived value on customer-based brand equity, brand resonance and customer affective commitment, respectively. Moreover, this study also tries to determine the mediating roles of brand resonance and customer affective commitment in the relationship between product perceived value and customer-based brand equity, respectively. The present study’s findings acknowledge that product perceived value did not directly influence customer-based brand equity. However, results confirmed that product perceived value positively influences brand resonance and customer affective commitment. Furthermore, the outcomes of the present study also concluded that both brand resonance and affective commitment played a mediating role between product perceived value and customer-based brand equity, respectively.

Data Availability Statement

Ethics statement.

The studies involving human participants were reviewed and approved by Harbin Normal University, China. The patients/participants provided their written informed consent to participate in this study. The study was conducted in accordance with the Declaration of Helsinki.

Author Contributions

GX conceived and designed the concept. XY collected the data. YQ wrote the manuscript. All authors contributed to the article and approved the submitted version.

Conflict of Interest

The authors declare that the research was conducted in the absence of any commercial or financial relationships that could be construed as a potential conflict of interest.

Publisher’s Note

All claims expressed in this article are solely those of the authors and do not necessarily represent those of their affiliated organizations, or those of the publisher, the editors and the reviewers. Any product that may be evaluated in this article, or claim that may be made by its manufacturer, is not guaranteed or endorsed by the publisher.

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Section 4 - Case Study GUESS Inc.