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Brand Equity: Everything You Need to Know

May 20, 2019

What’s in a name?

When it comes down to your decision to purchase a brand name product over a generic one, a lot is in a name.

The number of options we have as consumers can be a bit overwhelming. I mean, how many variations of the same product do we really need? This influx of products can turn a simple task like restocking your laundry detergent into a tougher chore than what you may have first bargained for.

Although there might be twenty or more laundry detergent brands on the shelf, there is always a specific reason for why you chose the brand of detergent you did.

Your loyalty to the brand of detergent you buy has been established for many reasons. Perhaps the quality is unbeatable, removing every stain every time from your messy toddler’s clothing, or maybe you just love the way it smells. Whatever the reason may be, you have found value in your selection, making it inherently better than the competitors due to your positive experiences.

Your brand of choice has positive brand equity.

What is brand equity?

Brand equity is one of the most valuable assets your company can obtain. It is an earned competitive advantage that results in higher sales and revenue, fierce brand loyalty, reduced overhead costs and premium consideration for your brand.

You’ll know when you have high equity when no matter how expensive the cost of your product becomes, your customers still want to buy it. Your ability to successfully spike product prices becomes the catalyst for immense success and brand expansion.

Although the price premium you are able to implement is fantastic, there are a number of other advantages of positive brand equity. For example, having a reputable brand makes for a seamless brand extension strategy. By extending your product offerings, you are able to appeal to target markets that you have never reached before which creates greater market penetration and brand recognition.

Having a strong reputation means that other reputable companies may want to partner with you to co-brand a product. Co-branding is a smart strategy two popular companies can implement to appeal to a massive customer base and capitalize on each respective market.

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Brand equity development cycle

To develop equity, your efforts must foster a positive experience that takes your customers successfully through the consumer cycle.

Marketing funnel cycle

You have successfully created positive equity if enough people have a positive journey through the funnel. An exciting milestone for any brand is when an ample amount of customers reach the very bottom of the funnel and become advocates and die-hard fans.

These people will soon have a voice louder than what your marketing and advertising efforts could ever do alone, and you will find yourself with a substantial amount of new customers who want to know for themselves why everyone thinks your brand is so amazing.

How to boost your brand equity

Building positive equity may seem like a simple task, but there are a few tactics you should continuously visit to ensure you are maximizing the equity you already have while actively boosting it where you are able to.

1. Quality products

There is absolutely no getting around this one. Consumers demand quality, and they should, considering the number of options on the market. Your customers will be gone in an instant and on to the next if your product doesn’t hold up for them. You also must consider the ease of use. Your product should be user-friendly with zero issues to ensure a streamlined experience. If your product is no good, your brand won’t get anywhere. In fact, you will have achieved the opposite of your goal by incurring negative equity which is an extremely difficult reputation to shake.

2. Listen to your customers

How could you possibly serve your customers without knowing what they really need? You have to listen and truly understand who your customers are and what their pain points are. By having this information, you will be able to better serve them and expertly cater to their every want and need. Your customers will also provide valuable feedback on review websites and social media. Accept any constructive criticism you receive and use it to better your brand. Mistakes and disappointments are inevitable, but if you prove that you truly hear them and are working hard to make whatever it is that they are upset with better, then your equity will skyrocket with them. Remember, you are only in business because you have loyal, paying customers. Don’t upset them, or you will face a disruption in sales that can quickly ruin your business and brand image.

Listen to your customers on review platforms. (Your company might already be listed on review sites!)  You'll understand exactly what your customers think of your product or services, and how they are using it. 

In addition, being on review platforms is one of the best ways to build your brand awareness. If  you're a B2B software or service provider, claim your free profile and connect with over 3 million consumers looking for solutions to buy.

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3. Watch your competitors

Understanding your competitive landscape is an important task to ensure relevancy. What are your competitors doing that is more superior than what you’re doing? What do they have that you don’t? How are they serving consumers better than you are? These are all important aspects of a competitive analysis that can’t be overlooked when you’re working to build equity. Learning what your competitors are doing and then doing it better than them is a sure way to keep your competitive edge and top of mind awareness with your target market.

4. Perfect your brand strategy

Your brand strategy is the blueprint that guides how your brand is communicated with the world. Ensuring that your strategy is perfect and consistent with the entirety of your efforts is the best way to communicate a powerful message that fosters positive opinions and perceptions from your target market. Your efforts will be in vain if you don’t have a solid strategy. It is crucial to have a strong direction to guide that positive equity you hope to attain.

Examples of brands with high equity

The following examples have some of the highest equity on the market. Let's take a look at what these brands do to be so successful:


For many people, Apple is the first brand that comes to mind when thinking about equitable companies. The greatest example of this is the day of a new Apple product launch. The size of the crowds that amass across the globe is unlike anything anyone had ever seen before. People spend hours camped out in a line just to get their hands on that shiny new product that isn’t much different than the model that preceded it.

apple store crowdSource: ABC News


The brand that has turned into the epitome of American coffee culture, it seems that Starbucks can do no wrong in the eyes of its customers. Love them or hate them, Starbucks has a fiercely loyal customer base that will support them no matter how many price increases they have. Take it from me, as an avid coffee drinker, my Starbucks order has been a Venti black iced coffee since 2015 when it cost $2.70. Today, I am still ordering my favorite drink at $3.85, and I don’t foresee my habits changing. Add that to the madness that ensues when new Instagram-able drinks are created, Starbucks definitely has the highest equity in the American coffee brand category.

starbucksSource: The Mad Mix


Not many other brands of workout apparel can convince a target market that its leggings are worth nearly $100 a pair. Granted, each piece of clothing is made of the best high-quality material and is backed by an amazing lifetime guarantee. Lululemon has built much more than an athletic brand image. They have created a fiercely loyal community of positive and uplifting healthy living individuals. When you think workout apparel, Lululemon is always at the top of your mind. 

Yoga class at LululemonSource: 30A

Build your equity

Positive equity is something that is lusted over by every single brand on the market, but only a few can fully achieve it. To be a category leader, you must offer high-quality products and boost your brand awareness while really getting to know your customers in the process.

Ensure your marketing mix is flawless before you try to increase your equity. Learn everything you need to know here!

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