Branding: Brand Equity Model, Culture and Advantages Analysis Report

This report provides a comprehensive analysis of brand equity, exploring its definition as an intangible asset that enhances product value and recognition. The report details the brand equity model, encompassing brand loyalty, awareness, associations, and perceived quality, highlighting how each dimension contributes to a brand's value and customer preference. It emphasizes the importance of culture in building brand equity, discussing how businesses can leverage innovative advertising and internal culture to create unique brand identities and foster consumer loyalty. The report also outlines the advantages of brand equity, such as increased sales, profitability, and the ability to differentiate products in the competitive market. Through examples like Coca-Cola and Apple, the report illustrates how businesses can build and maintain strong brand equity to achieve long-term success. The report also discusses the significance of brand elements like USP, logo, and brand endorsement in fostering brand recognition and consumer recall. The report also includes the importance of culture in building brand equity.

Branding

TABLE OF CONTENTS
BRAND EQUITY MODEL............................................................................................................2
IMPORTANCE OF CULTURE IN BUILDING BRAND EQUITY..............................................3
ADVANTAGES OF BRAND EQUITY.........................................................................................5
HOFSTEDE AND CULTURAL DIMENSIONS THEORY..........................................................6
REFERENCES................................................................................................................................9

Brand equity can be described as an intangible asset which helps businesses to ascertain a
value premium product with a recognizable name as compared to its generic product. Moreover,
organization can build brand equity for their products by making them easily memorable,
recognized and high quality products and reliability (Katyal, 2012). Further, with the help of
creating effective marketing campaign it assists businesses to create a brand equity. As per the
view of Dinnie (2015), it is essential for companies to create a positive brand image through
providing unique product features and design so that more number of customers are agreed to
purchase the product and willing to pay the price. On the other hand, if customers are willing to
pay more for a generic product rather than for branded products then it is stated as a negative
brand equity for company. However, such situation might happen if company faces issues
regarding product quality, brand name, product recall etc. that affects the company in many
ways. In regard to this, it is essential for business to prepare effective brand positioning in the
minds of customers so that positive brand equity can be build and more number of customers can
be attracted towards the business which helps in enhancing the sales and profitability of firm in
marketplace (Roper and Fill, 2012).
Furthermore, it can be assessed that the additional money consumers are willing to spend
in order to purchase Coca Cola instead of local soda brand which is an example of brand equity.
Thus, it is one situation when brand equity is crucial at the time when business wants to expand
its product line in market. However, if the brand equity is positive and there are various loyal
customers of company who are willing to purchase the product even at a higher price thus it is
stated as a brand equity as per Kavaratzis and Hatch (2013). It also helps in increasing the
likelihood towards company that enhances customer’s preference and assists them to purchase
the new launched product in relation to the successful existing brand. For example, if Apple
launches its new smartphone in market it is essential for them to keep the product under the same
brand name rather than introducing a new brand. It helps in building positive connection with
customers as they are already associated with company and helps in making positive brand
equity (Chiang and et. al., 2013).
Brand equity also helps in generating value to the brand so that large mass can be
attracted towards the business in order to enhance the sales and profitability. Brand equity can be
stated as a set of mixture of brand assets and liabilities connected to a brand name and symbol
that add to or subtract from the value delivered by the product or service. Through connecting the
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brand word to equip changes its concepts from marketing function and enabling them to expand
beyond strategic tactics and attain desired targets (Fan, 2014). By implementing effecting brand
equity model it can be assessed that it involves four different dimensions i,e, brand loyalty, brand
awareness, brand associations and perceived quality. However, all these factors helps in
providing value to organization in varied ways. According to Alter (2016), when an brand
identifies the value of brand equity, it helps them to follow the brand equity roadmap in order to
manage the potential value so that desired targets can be attained effectively and efficiently.
Following are the brand equity outlines which are as follows-
BRAND EQUITY MODEL
 Brand loyalty- It can be stated as the way in which consumers become loyal to the brand
and make repeat purchases in order to enhance the sales and profitability. It is a result of
consumer's behaviour and thus affects individual's preferences. However, loyal
consumers will constantly buy the products from their preferred brands regardless of
price differentiation. It also helps in attracting new customers through creating awareness
and reassurance (Leekha Chhabra and Sharma, 2014). Here, business is required to
respond to competitive threats so that original product can be provided to consumers
rather than generic product as per Dinnie (2015). For instance, if any consumer who is
techno friendly and he/she is willing to purchase smartphone than the brand name that
arises first in mind is Apple because company owns such as brand image in the minds of
customers therefore, it retains its loyal customers and do not lose them.
 Brand awareness- Here, it is another crucial dimension of brand equity model that states
that the extent to which consumers are familiar with the qualities or image of a particular
brand of products or services. For instance, the primary goal of businesses is to develop
advertising campaign in order to make individual aware about the product available in
market so that sales can be enhanced. Like, Coca Cola is developing effective advertising
campaign for its product through celebrity endorsement so that product can be made
famous among target consumers (Mi and Baharun, 2013).
 Brand associations- According to the view of Hirschman (2014), it involves the features
of brand that are involved within it and helps consumers to remember the product when
the brand is talked about. However, it involves different implicit and explicit meanings
that a consumer related to the specific brand name. For example, when IKEA name is
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taken in furniture industry, it resembles a positive image in the minds of consumers
because of its unique features i.e. low price, high quality products etc. Thus, all these
features help business to create a positive brand image in the minds of consumers and
interconnect them with the brand. IKEA helps in communicating its brand information to
consumers so that they can make differentiation among product as compared to other
furniture brand (Hirschman, 2014). Demonstrating the key features helps business to
provide consumers a reason to buy the products.
 Perceived quality- It is essential for business to develop effective quality for its products
and services so that positive brand image can be created in marketplace. It also helps
consumers to develop a positive feeling towards the brand so that large mass can be
attracted to purchase the goods. Hence, it helps in creating effective brand equity so that
desired targets can be attained (Wilson and et. al., 2013).
With the help of stated model it can be assessed that brand equity helps in developing
brand awareness and association of product in order to create value on it so that customer base
can be attracted to purchase the products and services. As per Aronczyk (2013), management of
firm is required to develop an effective brand so that it involves brand loyalty as a part of brand's
equity that allows marketers to justify a positive brand building budget. Further, it can be
assessed that businesses are required to develop brand equity so that it assists in providing value
to customers. For instance, BMW being a German automobile manufacturing firm helps in
developing its products in such a way that provides value to its customers by involving unique
features and attract superior class people by creating luxury value of product among them
(Aronczyk, 2013).
IMPORTANCE OF CULTURE IN BUILDING BRAND EQUITY
Furthermore, it can be stated that consumer has no idea regarding the company's events
and thus there is no real way of communicating the required information to consumers.
According to the view of Kapferer (2012), therefore, there should be an effective way of
communication in order to interact with the audience and inform them regarding the features and
value of the product so that brand identity can be created. Thus, business is required to develop
effective culture with the help of innovative advertising so that required features can be informed
to consumers in order to develop brand equity among individuals. It also helps in promoting the
price of the product or service by creating a superior feature or unique strategy so that best
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results in the form of success can be attained. For instance, with the help of effective advertising
CEO of Volkswagen created a unique advertisement so that they can gain consumer attention
towards the product by creating a unique tag line or demonstrating features etc. Also, it is
essential for business to develop effective culture within enterprise so that brand equity can be
built effectively and efficiently (Kapferer, 2012). Hence, it is crucial for enterprise to launch
effective products and services in regard to satisfy the needs of customers. Also, culture of
business plays a significant role in order to enhance the sales and profitability of company
because with the help of this business improves the brand loyalty and awareness in market.
Hence, culture plays a crucial role in building effective brand equity so that corporate image of
firm could be enhanced (Blichfeldt and Halkier, 2014).
It is essential for business to create awareness of its product among customers so that
they can drive the sales. According to the view point of Park-Tonks (2013), businesses are
required to build unique brand image in minds of consumers by developing effective attempt to
attain target marketplace. However, it is crucial for firm to build effective culture so that
individual can be made aware about the available product and its features in order to align with
the target audience. Business is also required to create effective internal culture so that
employees need to work together and create a unique design product or service so that effective
corporate image can be built of firm (Park-Tonks, 2013). For instance, Nike creates a unique
brand image through launching their 6.0 line of shoes which is designed for the multi action
sport people. Such companies are required to develop effective brand image in market so that
important communication can be delivered to consumers in regard to enhance the sales and
profitability. Thus, developing both internal and external culture within enterprise assists in
building brand equity so that set goals can be attained effectively and efficiently (Danesi, 2015).
It can be assessed that brands are symbolic units that are used in order to create a unique
identity as compared to competitor’s products so that brand awareness can be created among
target marketplace. It is not easy for competitors to copy the product because products
differentiate from each other and thus creating value of original products as compared to generic
one. Brand can be viewed not solely as a sign involved to products that differentiate them from
competing products but as a diverse product with different meaning and values. As per the
opinion of Kavaratzis (2012), brand equity can be derived as the result of a process that leads to
creation of unique and distinct brand identity in market so that sales and profitability can be
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enhanced effectively. For instance, Apple creates a unique identity in market through developing
effective product design and features that differentiate company from its competitors. Thus,
Apple creates a unique culture within business that involves of effective brand awareness and
loyalty among consumers which helps in developing effective brand equity (Kavaratzis, 2012).
There are different features such as Unique Selling Proposition (USP), logo, style and
brand endorsement etc., are the effective brand elements that facilitates the process of consumer
brain mapping in order to develop effective brand equity. However, after certain a period of time,
consumers are able to identify the brand elements effectively in order to purchase the relevant
brand and develop a differentiation within competing brands so that sales can be enhanced.
Moreover, there are numerous other factors that help in creating a good brand element (Wæraas,
Bjørnå and Moldenæs, 2015). It is a process that helps individual to recall the product for
instance half eaten apple reminds individual of brand Apple. Thus such sort of logo helps in
developing effective brand image of company so that set goals can be attained by firm.
ADVANTAGES OF BRAND EQUITY
There are varied advantages involved within business culture so that brand equity can be
build-
 Enhanced margins- Here, it can be assessed that positive brand equity allows business
to charge more prices for products or service because people will be willing to pay a
premium price for the brand name. For instance, as individual's are ready to pay premium
prices for diamond jewellery as compared to gold or silver. Consumers are ready to pay
the price for the quality of those products that are different from competitors. Thus, it
helps in enhancing the sales and profitability of firm in marketplace (Davis, 2013).
 Customer loyalty- Furthermore, businesses are not only willing to pay more for a
product with strong brand equity but they are also willing to enhance their loyal customer
base and provide those required products and services. For instance, Apple, BMW and
Nike are some of the companies that possess strong brand loyalty and overcome bad
customer experiences in order to achieve desired sales (Schlegelmilch, 2016).
 Opportunities for expansion- Developing positive brand equity help in facilitating
company's long term growth. Through creating effective value of the brand it helps firm
to develop effective new products and services in order to attract more customers to
purchase the new product. Further, it also helps company to expand the products into new
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markets and thus assists people to effectively recognize the brand and make instance
positive connection (Dean and Taylor-Gooby, 2014).
 Negotiating power- Further, building positive brand equity develops a considerable
advantage so that they can negotiate with business suppliers and distributors so that high
quality products can be delivered to consumers in order to gain effective position in
market (Barbat, 2014).
 Competitive advantage- Here, it is essential for organization culture to help in
developing effective brand equity so that firm is able to gain competitive edge over rivals.
It also assists business to pay a premium price for firm's products and services in order to
gain consumer attention (Daye, 2010).
HOFSTEDE AND CULTURAL DIMENSIONS THEORY
It involves different values that can be placed upon six different cultural dimensions such
as power, collectivism, uncertainty avoidance, masculinity, temporal orientation and indulgence.
Further, Hofstede collected most of the data upon world cultural values so that best results can be
attained.
 Power-Distance Index- Here, the members of organization is less powerful and thus
accept and except that power of individuals is distributed unequally. However, such
dimension does not measure the level of power distribution in a given culture but helps
business to provide democratic culture within business so that power relations can be
equals (Mooij, 2010).
 Individualism vs Collectivism- In this the individual are integrated into different groups.
Thus, such dimensions help business to develop effective brand equity in order to
develop group behaviour rather than individual. Here, importance of culture is effective
as achieving personal goals in relation to attain collective goals of firm (Katyal, 2012).
 Uncertainty-Avoidance index- Here, the tolerance for uncertainty and ambiguity that
helps in measuring the way a society deals with different unknown situations so that
unexpected events and stress can be overcome in order to develop effective brand equity
of firm in marketplace (Roper and Fill, 2012). Business also involves effective rules and
regulations in order to develop more open to change and thus have few rules and laws so
that set brand image can be attained effectively.
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 Masculinity vs Femininity- In such dimension of culture, it is essential for distribution
of emotional roles between different individuals. There are different attributes involves
within culture places such as ambition, power, emphasis upon human relationships. For
instance, culture within organization helps in developing differences between genders
and thus then to develop a competitive edge over rivals (Alter, 2016).
 Long term orientation vs Short term orientation- Here, it describes the society's time
horizon so that short term culture can be developed in order to build an effective brand
image of firm in market and thus develop effective relationship with each other so that
desired goals can be attained. Furthermore, long term relationship is required to be
developed so that business aims to build future relationship with consumers in order to
value their needs and preferences and thus attain desired targets (Hirschman, 2014).
 Indulgence vs Restraint- It measure the ability of culture in order to satisfy the
immediate requirements of consumers so that strict social issues and norms can be
attained in order to attain desired targets (Wilson and et. al., 2013).
Hence, Hofstede aims to stress upon the different cultural dimensions which helps in
assessing the better guide to decision making so that sales and profitability of firm can be
enhanced. Through developing effective culture within enterprise brand equity of organization
can be built to achieve desired targets.
Furthermore, it can be assessed that importance of organizational culture helps in
building brand equity so that set goals can be attained effectively and efficiently. Culture is
required to be developed as per the set guidelines so that brand awareness can be built among
potential consumers. It also helps in building quantity of memory structure so that brand can be
effectively made popular among competitive market in order to make purchase decision
(Kapferer, 2012). For instance, Subway organization is creating a unique culture within business
that states that firm is required to provide fresh meals to clients so that their hunger can be met
along with necessary nutritional guidelines. Hence, developing such as effective culture assists
business to develop brand awareness among potential customers in order to enhance the sales
and profitability of firm in market. Moreover, organization is also required to create its own
unique identity in market so that it can be remembered by each and every individual at the time
of need (Park-Tonks, 2013).
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Hence, it can be concluded from the study that branding is the strategy that aims to
develop effective brand awareness of product and service among potential consumers. Also, it
helps in stating that organizational culture is a crucial part within enterprise that assists in
building brand equity and retain loyal consumers within firm. Thus, implementing Hofstede
model helps in identifying different dimension of culture in regard to attain desired goals.
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REFERENCES
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citizenship behaviour: multilevel analysis and managerial implications. Journal of
General Management. 39(1).
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marketing and branding. Polity.
Dean, H. and Taylor-Gooby, P., 2014. Dependency culture. Routledge.
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Fan, H., 2014. Branding a place through its historical and cultural heritage: The branding project
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Kavaratzis, M. and Hatch, M. J., 2013. The dynamics of place brands an identity-based approach
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Kavaratzis, M., 2012. From “necessary evil” to necessity: stakeholders' involvement in place
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Mi, T. J. and Baharun, R., 2013. Introduction to SMEs in Malaysia: Growth Potential and
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