Brand Equity Basics - Part 2: How to Build Brand Equity

aytm logo icon
Posted Oct 10, 2011
Susan Gunelius

In Part 1 of the Brand Equity Basics series, I answered the question, "What Is Brand Equity?" Today, it's time to learn how to build positive brand equity, so your brand becomes a valuable asset to your organization. Whether you're launching a new brand or managing an established brand, you should continuously be working to build its equity.

brand equity basics

As you learned in the first part of this series, consumers go through 5 stages of brand experience, which moves them from a state of brand awareness to a state of brand loyalty where they demand the brand and accept no substitutes.

Brand equity grows as consumers move through those 5 stages of brand experience. It's the organization's job to help consumers move along that path.

There are many factors that go into building brand equity and at the heart of each is developing a brand that consumers want to experience. Notice how each factor focuses on consumers, not the organization. As you learned in Part 1 of this series, consumers build brands, not companies.


Consumers must understand and believe that the brand is relevant to their wants and needs, and it offers distinct benefits that other brands in the market don't provide at all or don't provide as well. This is where brand positioning is critical in building brand equity, and marketing investments must be made to communicate those differentiators. For example, there is no doubt that Apple is different from Microsoft based on the highly successful Mac Guy vs. PC Guy ads.


In order for a brand to build positive equity, consumers need to believe that it adds enough value to their lives to be worth the price and the effort to buy it. That means the brand needs to be readily available to them and the price must accurately reflect the experience delivered by the brand.



Consumers need to believe that the brand will deliver on its promise through every touch point. In other words, they need to be able to depend on the brand to meet their expectations based on their perceptions of it. This is done through communicating the brand promise and living up to that promise in all aspects of the business such as customer service, pricing, social responsibility, and so on.

Toyota offers the perfect example of a company that has successfully built brand equity that can survive big problems. When a series of Toyota brand recalls occurred a couple of years ago, the problem registered as a short-term blip in the company's results. The brand had enough equity that consumers believed its promise of quality and reliability, and they believed the company would make things right and continue to meet expectations in the future.

Emotional Connection

Consumers must fully understand the brand and believe in it in order for it to build equity. As trust develops through experiences over time, consumers develop emotional connections to a brand just as they build emotional connections with friends. They can depend on the brand just as they would depend on a friend. Emotional connections develop as a result of performance.


harry potter quidditch

When consumers enjoy experiencing brands together, those brands reach levels of success as cult brands and ultimately as true relationship brands. Consider brands like Harley Davidson and Apple, which are two of the strongest relationship brands in the world. Groups of loyal followers are very powerful, as the Harry Potter brand exemplifies, and the social web provides an opportunity to engage with consumers and build communities of brand enthusiasts who can boost word-of-mouth marketing, sales, and brand equity.

Remember, building brand equity is an ongoing effort that never ends. In order to ensure you're building positive brand equity, you need to constantly measure your brand's performance. That's the topic of Part 3 of the Brand Equity Basics series, which is coming up next on the AYTM blog. If you missed Part 1, you can follow the preceding link to read it now.

Images: davdibiase, thienzieyung, pretendtious

Featured Stories

New posts in your inbox