What is brand equity?
Brand equity is the value that is derived by the customers, not because of the product or service provided by the organization but because of the consumer’s perception of the brand name.
In other words, the utility provided by a brand’s name and its logo is brand equity. For eg., Apple products are status symbol goods. It’s the brand equity of Apple that keeps it going even when its products get mediocre reviews. Even the back cover of Apple phones are such that they don’t cover the logo of the company.
Why does brand equity matter?
Brand equity matters a lot for those brands that are one of the many players in the monopolistic market(a type of market in which there are a large number of sellers and the products are close substitutes to each other.), eg., a manufacturer of soap.
In a monopolistic market, the players need to be proactive and should have a rigorous marketing strategy to stay in the market, and over some time all this marketing would pay off in the form of brand equity.
Social brand equity
In the pre-social media era, customers didn’t have much scope to voice their opinion, but with the advent of social media customers now have the platform to raise their voices which can affect the brand equity of any brand.
How to measure your social brand equity?
Customer awareness about your goods or services is a crucial part when we talk about measuring brand equity. According to Keller (1991), one of the dimensions of brand equity is brand awareness, which represents the strength of a consumer’s memory record for the brand.
But awareness is just not enough, you need to try making people remember your names. eg., whenever we talk about toothpaste, the name which strikes us is Colgate.
A simple way to measure brand equity is to know how much likes and comments do you get in your posts on different social media platforms. Also is your posts more likely to be shared than your competitor’s post can also tell a lot about brand awareness and social brand equity.
Brand relevance means the extent to which your brand provides specialized and unique services that your competitors fail to provide. This plays a major role to increase your sales as through this aspect your brand can become word of mouth. It helps to measure brand equity to a great extent.
If your customers are sharing positive comments and experiences about your brand then kudos to you, you are creating social brand equity.
How responsive are the customers about the emotions that you display in your advertisements also plays a major role in determining your brand equity.
65% of people that feel an emotional connection to a brand say it’s because “they care about people like me.”
Coca-Cola and PepsiCo are perfect substitutes in the carbonated beverage market but the former’s market share is more, apparently because of the emotional connect it has with the customers which play a major role in its brand equity.
Sales performance based on social media branding also tells a lot about your social brand equity.
To check brand equity based on sales performance, you need to see the total number of positive comments on your post, then match the same with the number of products sold online.
If the number of positive comments on your advertisement is approximately equal to your products sold online then you have good social brand equity.
In the case of Nike’s advertisement campaign on its 30th anniversary, its controversial advertisement featuring Colin Kaepernick gave the brand’s sales a boost.
You need to keep a check on the surge in sales of your as well as your competitor’s products when any special perks are given to the customers, for eg. how much do you and your competitor record a surge in sales during a BOGO offer(buy one get one free) announced on different social media platforms.
This is a relative concept. If the surge in sales recorded by you is more than your competitors then that means customers are more enthusiastic about your product. You can conclude that your social media equity is in a sublime performance.
Brand engagement signifies an emotional engagement to a brand. To know about the brand equity one should find about the extent to which the individuals react to the news related to different products of the brand.
If people follow your brand on different social media platforms more than any other rival brand then you got the maximum social brand equity.
This metric is about how many customers can a brand retain when the percentage change in its product’s price is more than that of its rival brand’s products.
If a brand loses customers when it tries to charge just 5 to 10 rupees more than its rival then that probably means that the social marketing team didn’t do justice to the funds allocated to them, as a result of which the social brand equity suffered. Also, Price premium over competition, Average transaction value, Customer lifetime value, Rate of sustained growth also tells a lot about sustained growth.
Brand equity plays a major role in every brand that’s the reason why Nike is one of the top companies. A brand can use interactive video session also for customer grievances. Measuring and building social brand equity is very important to predict a brand’s performance and keeping it afloat when the odds are against it.