Brand equity has been distinct as a set of brand assets and liability linked to a brand, its name, and its sign that add to or take away from the value offer by a product or service to a firm and/or to that firm’s clientele. If the brand’s name or symbol should change, some or all of the possessions or liabilities could be exaggerated and even lost, although some might be shifted to a new name and symbol. The assets and responsibility on which brand equity is based will, according to Aaker (1991), differ by context. However, they can be grouped into five categories:
(1)Brand Name Awareness
People will often buy a well-known brand because they are comfortable with the familiarity or they suppose that a brand that is familiar is probably reliable and of reasonable quality. When consumers feel nervous about a product’s name, they will avoid the product - and that translates into the loss of sales. Brand names should be easy for customers to envisage, and this involves pronunciation and spelling.
(2) Additional Proprietary Brand Assets
This fifth category symbolizes such other proprietary brand assets as patents, trademarks, and channel dealings. Brand assets will be most valuable if they inhibit or prevent competitors from eroding a customer base and loyalty. These assets can take several forms. For example, a trademark will protect brand evenhandedness from competitors who might want to confuse customers by using a similar name, symbol, or package. A copyright if strong and relevant to customer choice, can prevent direct opposition. A distribution channel can be controlled by a brand because of a history of brand presentation.
(3)Perceived Quality
A brand will have linked with it a perception of overall quality, which is not necessarily based on knowledge of detailed specifications. The quality awareness may take on somewhat different forms for different types of industries. Professed quality means something different for Compaq or IBM than for Coca-Cola or Pepsi. Perceived advantage will directly influence purchase decisions and brand loyalty, especially when a buyer is not aggravated or able to conduct a detailed analysis. It can also support a premium price, which, in turn, can create gross margin that can be reinvested in brand equity. Further, apparent quality can be the basis for a brand extension. If a brand is well-regarded in one context, then the statement will be that it will have high excellence in a related context.
(4)Brand Loyalty
For any business, it is luxurious to gain new customers and relatively inexpensive to retain existing ones, especially when the existing customers are content or happy with the brand. Competitors may even be disheartened from spending resources to attract already satisfied customers. Further, higher loyalty means greater trade influence; since customers be expecting the brand to be forever accessible.
(5)Brand Associations
The primary value of a brand name often is based upon specific relations linked to it. The associations, for example, of the car brand Jaguar may make the experience of owning and driving one “different”. Stipulation a brand is well positioned upon a key characteristic in the product class (such as technological superiority), then competitors will find it hard in the direction of attack. If they attempt a forward physical attack by claiming superiority via that dimension, there will be a credibility issue. They may be forced to find another, maybe inferior, basis for competition. Thus, an friendship can be a barrier for contestant.
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