Understanding What a Brand Is.

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What is a Brand & Brand Equity.

What is a Brand

To firstly understand what a brand is, one needs to understand the concept. A brand is an unique mark such as: sign, symbol, words, slogan or a combination of these. It is a designed image that identifies a product and differentiates it from its competitors and is remembered by the public.

Eventually, this image becomes associated with a level of credibility, quality, and satisfaction in the consumer’s mind (see positioning). Therefore brands help consumers know the difference in crowded and complex marketplace, by standing out from its competitors. A legal name for a brand is trademark and, when it identifies or represents a firm, it is called a brand name. See also corporate identity.

What is Brand Equity?

When a Brand gets national or international recognition it starts to have brand equity which is a marketing term that describes a brand’s value. That value is determined by consumer perception of their experiences with the brand. If people think highly of a brand and recommend it to others it starts to have positive brand equity. When a brand consistently under-delivers, disappoints and has bad reviews to the point where people avoid buying it or using it’s services, it ends up having negative brand equity.

Positive brand equity has value:

Once the brand is well known and sought after, companies can then charge more for a product or service from credibility of brand equity. That value can be transferred to line extensions – products related to the brand that include the brand name – so a business can make more cash-flow from the brand. It can help support an organizations stock cost..

How Brand Equity Develops

Brand equity development and growth is a direct result of a customer’s encounters with the brand. The proceedure commonly involves the natural association with the consumer and the brand that unurls following an anticipated area:

Awareness – The brand is acquainted with its intended targeted audience – with aggravated marketing and advertising strategies, through television, radio, editorial and ppc advertising.

Recognition – Customers become acquainted with the brand and have a mental visualisation of what the mark looks like.

Trial – When the consumer perceives the brand with confidence, which makes them consistantly loyal to continually purchase it and is therefore more inclined to recommend it to others simply from good experience.

Loyalty – After a progression of good brand encounters, consumers will start making good reviews which can enchance the brand name and the consumer will then recommend it to others, through word of mouth.

Examples of Positive Brand Equity

Rank Brand Value ($m) Change
1 Apple 178,119 5%
2 Google 133,252 11%
3 Coca-Cola 73,102 -7%
4 Microsoft 72,795 8%
5 Toyota 53,580 9%


Examples of Negative Brand Equity

Negative brand equity occurs when an organizations brand image actually has a negative impact on its business – meaning that the organization would be better off trading without a brand name. In the Seventies when Tesco’s, UK’s grocery brand was so inefficiently perceived that Imperial Tobacco decided not to be associated with the retailer or acquire them because of the paranoid fear of being associated with such a tarnished and unpopular organization.

It happened again in the Nineties when Skoda despite spending millions on Advertising and Marketing Campaigns could not convince the british consumers to buy its cars. Consumer marketing research later conducted affirmed that 66% of its objective market would certainly not consider purchasing anything that resembled the Skoda badge, because it was perceived as cheap and without class and not noteworthy.

Citation: https://www.brandingstrategyinsider.com/2010/07/negative-brand-equity-a-bp-death-sentence.html

Financial brand Goldman Sachs lost its brands reputation when the public learned of its role in the 2008 financial crisis.

Car maker Toyota suffered in 2009 when it had to recall more than 8 million vehicles because of unintended acceleration, and oil and gas organizatiin BP lost critical brand equity after the U.S. Gulf of Mexico oil slick in 2010.

Achieving positive brand equity is only half the job; maintaining it consistent reputation is more difficult as in the case of Chipotle’s in 2015 food poisoning crisis where by one negative incident can wipe out years of favorable brand equity.

You can watch ‘Chris Zuiker’s’ video here about Brand Names: https://youtu.be/gxmoAEFvRFg

Finally – Remember when you have a domain name, you have to establish first of all how will it benefit the end user. How are you going to convince someone to buy your domain name when they already have a developed website with their desired domain name?

  1. Is the domain name brandable
  2. Who would benefit from the brand name
  3. Has it got brand equity (Do you think that this name will be well known and why and how much will it cost for advertising and marketing)?
  4. Is your domain developed (Visualisation and SEO Optimization helps the end user imagine what their business will look like).
  5. Is your domain generating traffic (high volumns of traffic help companies get more business)
  6. Is your domain name a costly ppc keyword (consider developing a blog for the enduser).

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