What is Brand Equity?

08.10.21

Simply put, it’s the difference between Tesco’s Cola and Coca Cola.

Brand equity is the most valuable part of any brand. Brand equity is the intrinsic value of the consumer’s perception of the brand.

A brand is a persons gut feeling about a product or service
—Marty Neumeier

Brand Perception

The customer’s perception of the brand is the most valuable part of the company’s brand. Brands with high levels of brand equity are always top of the list when I ask my client’s what brands do they resonate with, and there is a good reason for this. Nike, Apple, Mercedes, all household name brands invest millions of dollars a year to ensure they maintain equity in the minds of their consumers.

Brand Loyalty

Brand loyalty is built through consistent, quality consumer engagement with a brand. Coke tastes the same, in any country in the world. When you see the white cursive logotype script on the red, it is instantly recognisable in any language, and the picture of the fizzing, refreshing, energising sugar-hit of the coke taste is immediately bought to mind.

Quality and consistency creates an identity
—Jony Ive

Over time, the consumer’s experience will drive their perception of the brand. Therefor, brand promises that are consistently delivered on, instils more and more loyalty.

Each time that the customers expectations are delivered on, the lower the barrier is for the sale to take place. For the company, this is an ideal self-sustaining cycle.

Ultimately, high brand equity results in stronger brands which are less effected by market competition, specifically on price.

So… do you want Tesco’s Cola, or Coca Cola?

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About the author, Adam

Adam is the design director of BrandCraft. BrandCraft is a branding and design consultancy based in Hong Kong. We specialise in branding, visual identity, corporate identity and rebranding.

Adam is a branding consultant and has worked with clients in the UK, USA, Hong Kong, Tokyo, South Korea and China. He has had self-initiated art and design projects exhibited at various galleries and museums including the Victoria & Albert Museum of Art and Design and regularly writes about branding and design theory.