Brand Equity and Image Assessment

The most important assets of any business are intangible — including its base of loyal customers, brands, symbols & slogans — and the brand’s underlying image, personality, identity, attitudes, familiarity, associations and name awareness. These assets — along with patents, trademarks, and channel relationships — comprise brand equity, and are a primary source of competitive advantage and future earnings.

The brand is a distinguishing name and/or symbol (logo, trademark, or package design) intended to identify the origin of the goods or services — and to differentiate those goods or services from those of competitors. A brand signals to the customer the source of the product, and protects the customer and producer from competitors who would attempt to provide products that appear to be identical.

By developing strong & consistent images, well-regarded brands generate hidden assets — or brand equity — that give them distinct advantages. Brand equity is a form of wealth that is closely related to what accountants call "goodwill."

A brand is a promise made to its customers and shareholders. Promises that are kept yield loyal customers and produce steady streams of profits. Brand equity is initially built by laying a foundation of brand awareness — eventually forming positive brand images — and is ultimately maximized by high levels of brand loyalty.

At least five general approaches to assessing the value of brand equity have been proposed.

• Price premium that the name can support
• Impact of the name on customer preferences
• Stock market valuation (stock value less tangible assets
• Earning power of the brand
• Replacement value of the brand

Brand equity has been also defined as:

• The component of overall preference not explained by objectively measured attributes; and
• The set of consumer associations & behaviors that permits the brand to earn greater volume or margins than it could without the brand name.

Brand image is everything. It is the sum of all tangible & intangible traits — the ideas, beliefs, values, prejudices, interests, features & ancestry that make it unique.

A brand image visually & collectively represents all internal & external characteristics — the name, symbol, packaging, literature, signs, vehicles & culture. It's anything & everything that influences how brand or a company is perceived by its target constituencies — or even a single customer.

Brand image may be the best, single marketable investment a company can make. Creating or revitalizing a positive brand image is a basic component of every business — and lays a foundation on which companies can build their future.

SMART has the expertise & tools to design & implement brand equity & brand image assessments that give companies the strategic guidance needed to fashion the best image and build the highest possible brand equity.