Marketing Management - Brand Equity

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Brand equity can be described as the value of a well-established brand name. A product of a popular brand can generate more revenue as compared to an unknown brand. Consumers have a perspective that a product from well know brand will be better in terms of quality than others. This gives an advantage to a branded product over an unknown product.

Elements of Brand Equity

Brand equity valuation is difficult and doesn’t have any basic criteria. Some of the elements associated to it include −

• Consumer loyalty

• Awareness of brand

• Quality of product

• Association with brand

• Proprietary assets owned by the brand

Elements of brand equity add a value to the brand; a successful brand has all the elements of brand equity.

Brand Benefits

A brand has various advantages compared to unknown products. Some of the benefits are as follows −

• It increases customer confidence in purchasing decision

• It increases efficiency and effectiveness of advertisement and promotion

• Brand loyalty is increased

• Products can be priced higher for bigger margin and higher Return On Investment (ROI)

• Extension of brand

• Leverage in trade

• Unique position of brand

Packaging

Packaging is a method used to protect the product from external factors during transportation or storage. Depending of the nature of product, the packaging can differ.

At the same time, packaging creates a first impression on the consumer so it should be designed accordingly.

Characteristics of Packaging

The characteristics or different features of packaging can be listed as follows −

• Attractive packaging

• Identity of product

• Development

• Sustainability of product

• Looks genuine

• Reveals image of brand

Packaging gives an overview of the product so these characteristics should be considered during the design of packaging.

AIDAS Formula

AIDAS theory is a very popular marketing technique. It states that a consumer goes ssthrough the following five stages before showing satisfaction for a product.

• A − Attention

• I − Interest

• D − Desire

• A − Action

• S − Satisfaction

These stages are to be evaluated and kept in perspective during the packaging design of the product.

Packaging Strategies

The design of packaging can provide an advantage in the market over similar category product. The following are the different strategies for effective packaging −

• Packaging of product line

• Multiple packaging

• Changing the package

Proper execution of packaging strategies can increase the attractiveness and durability of the product.

Labeling

Labeling is the process of marking an identity on the product. The information used for labeling contains the following details −

• Name and address of the manufacturer

• Name and address of the distributer

• Maximum Retail Price (MRP) of the product

• Manufacturing date of the product

• The method used to manufacture

• Ingredients used

• Precaution details

• Quantity

• Expiry date

The information provided in labeling is important because of various reasons like tracing the origin of the product, genuinity of product, etc.

Product Mix

Product mix refers to all the products offered by a particular company. As an example, Reliance Industries has products like cellular service, power, entertainment, etc. Hence, a strategy should be planned such that the uniqueness of the product can be established.

Positioning the Product

It includes positioning in relation to competition, positioning with attributes, and positioning in relation to price and quality of other products in the segment. The product has to be positioned as per these factors in their respective sectors.

Product Mix Expansion

It includes Product depth and product line. These are the dimension of the product mix. It depends on the number of products manufactured by a company.

Planned Obsolescence

Planned obsolescence is a strategy to create space for a new product with the help of advertisements showing an existing product to be out of date or fashion. This strategy is therefore considered controversial. However, it creates a void, which can be filled with a new product satisfying the thirst of newness.

Planned obsolescence is of the following two types −

• Technological obsolescence

• Style obsolescence

These strategies are used to create a void for a newer product.