Brand Equity: Definition, Elements, Ways to Improve & Examples of Brand

Brand equity is – Sinaumed’s, do you know the reason why people line up for goods that are expensive and still sell well in the market? Well, there is a long process to be able to achieve something like that, one of which is increasing brand equity .

We can take the example of Apple products which are in great demand when launching new products. However, make no mistake, competing brands, such as Samsung, Xiaomi, and other mobile phone brands may also have launched products that are no less sophisticated than the iPhone or Apple products. However, enthusiasts and queues from competing brands have never exceeded Apple products.

So what is brand equity itself? and how important is the role of brand equity for the success of a business? How to build good brand equity? Everything you want to know about brand equity will be discussed further in the article below.

Definition of Brand Equity

You need to know that brand equity is one of the important things in a business. Brand equity or it can also be said as brand equity is the added value that a company has when compared to its competitors. Brand equity is also influenced by the perceptions and experiences of consumers.

Building brand equity is important and needs attention for business activists because surely every company will try to have positive brand equity. If a company has superior brand equity , then consumers also have confidence in the products they make.

Consumers will choose products from that brand compared to other products out there and are willing to pay high prices for the company’s products or services even though they can get the same thing from other brands.

However, a business also needs to provide value to its customers, not just products. Brands that carry values ​​will be closer to their consumers and superior to their competitors.

Basic Elements of Brand Equity

One of the most difficult things to do when increasing brand equity is to maintain the stability of consumer trust in the long term. Therefore, there are several basic elements in an effort to build brand equity , the following are the basic elements of brand equity:

1. Brand Awareness

The first element is brand awareness , which is the level of consumer recognition of the brand. In this stage, consumers will be familiar with a product. When consumers are familiar with the product, it is hoped that there will be an incentive to buy the product.

There are several ways you can do to increase brand awareness to consumers, such as providing free trials, sponsorships, or even event marketing and doing product placements in several places.

If you are new to starting a business or just starting out, you can increase brand awareness by creating a website, creating an Instagram account, writing a blog on topics related to your product.

2. Brand Associations

The next element in brand equity is brand association , this is the stage where your product sticks in the minds, minds and hearts of consumers. Brand association can be regarded as a connection between a brand and its concept so that it is easy to remember.

This association can be a name, logo, concept or emotion related to the experience when someone interacts with the product.

An obvious example is when you want to buy mineral water, the first brand that comes to your mind is Aqua. The reason is, aqua itself is a translation of water, so remembering it is not difficult. Another example is when you talk about instant noodles, the first brand that comes to your mind is Indomie. So, it can be said that this Indomie brand replaces the word instant noodle itself.

Brands with high equity can occur if they have positive associations from consumers. How a company positions their brand among its competitors. Brands that are positioned correctly will appear competitive and attractive in the eyes of consumers.

3. Perceived Quality

Apart from using a strategy, as a businessman you also need to give consumers an impression of marketing products. You need to find out if they are satisfied or disappointed with your product and find out the reasons so you can improve the quality of future production. Because perceived quality is related to products/services to get a positive impression you need to strengthen quality and customer experience .

4. Brand Loyalty

Brand Loyalty or loyalty to a brand is a positive perception in the minds of consumers on certain products. This perception will create loyalty, so consumers will continue to buy and use the products you create.

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Brand loyalty refers to consumer loyalty to products from a brand. When it reaches this stage, consumers will find it difficult to switch to other products even though they are lured by low prices and so on.

Long-term relationships with customers will also be relatively more durable. If you launch new products, consumers are happy to choose their favorite brand instead of competitors

5. Property Brand Assets

Brand equity can increase positively if a brand continues to produce new innovations that keep up with the times. This is done to build a positive image in the eyes of consumers that a brand must actively pay attention to user behaviors in a flexible manner.

An example that we can take is the Nokia brand cellphone , which is the king of the cellphone market, which ultimately did not develop and collapsed because of competitors. This is because Nokia rejects Android and still insists on maintaining Windows. Meanwhile, user behavior will change over time, so innovation and brand flexibility are also needed.

Benefits of Building Brand Equity

Not only is it able to increase sales value and product marketing traffic, brand equity can also contribute many other benefits to the company. The following are the benefits of brand equity:

1. Able to survive in the midst of competition

When a brand or product has gained great trust from customers, this will make it a stage against existing competition. If we take a real example, the Iphone and Samsung brands are still equally in demand by gadget lovers even though there are already many brands that have sprung up. This is because both brands have earned the full trust of their users.

If you create a strong brand, you will also be able to get royal customers. You don’t need to move too much and walk as usual with whatever happens including increasing business competitors, but you already have loyal customers.

2. Getting Loyal Consumers

By increasing brand equity you will get loyal customers. If brand equity is formed consistently, consumers will increasingly trust and be loyal to the brand. Several studies have shown that more than 59% of consumers repurchase the same brand they trust.

This is because brand equity makes consumers believe in the quality of the products that appear. Even though some brands have expensive product prices, many loyal customers are still looking for them.

3. Increase Customer Retention

Customer retention is the company’s efforts to retain consumers. In this case, brand equity is able to increase consumer confidence in a brand, so that it makes them interested in buying other products with the same people because they have realized the superiority of the product they have previously purchased.

We can see a real example from Apple again. If someone already uses an iPhone, then he will also tend to buy other Apple products such as the Apple Watch, MacBook, iPad and iPod.

4. Price is not a problem

As explained above, the effect of brand equity on consumer loyalty is positive, so consumer loyalty will also be formed. Therefore, this can make consumers put aside the price issue. They will believe that the price increase will be proportional to the quality that will be issued.

The products issued by Apple always sell well at high prices, such as cell phones worth dozens to tens of millions of rupiah, which are willing to be searched for and queued for long. Companies will continue to compete in increasing brand equity because price is no longer a problem for consumers.

5. Can do product differentiation

Many companies with brand equity are able to compete in the global market because they present product differentiation. Differentiation is generally a differentiator in similar products between one company and their competitors. The high status of the company’s brand equity is able to have a positive impact on product differentiation activities which will affect promotion and market segmentation.

6. Increasing the existence of the company

The last benefit is that it can increase the existence of the company. Increasing customer demand and loyalty will have a big impact on the company. It will be better if the company continues to innovate, so that it remains superior to its competitors.

How to Build and Increase Brand Equity

To obtain the above benefits, the company will carry out various effective methods to build good brand equity in the eyes of consumers. Here are ways to build brand equity that you can see:

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1. Create a strong brand identity

The steps you can take are to build brand equity by establishing a strong identity for your brand. Create a standout identity and determine what your brand looks like from a consumer perspective.

Brand identity must be in line with the product being carried. What is the target market like, and why do they need that product compared to other similar products on the market. A strong brand identity will make consumers closer to the brand.

2. Improving Customer Experience with product trials

Understand what consumers need and want, then adjust it to the standards of the products and services you provide. Companies must work hard to ensure consumer satisfaction and have a pleasant shopping experience, so that consumers will come back for more.

To find out if your product falls into that category, you can find out by improving customer experience . Improving customer experience can be done by providing free trial products so that the public can immediately assess the quality and superiority of your product compared to competitors’ products.

3. Deliver Brand Values

Communicate brand values ​​to consumers. Brand identity must also have a relationship with the brand value that is being carried. Consumers will tend to more easily build bonds with brands that have the same values. For example, a company that is committed to being green will easily attract bonds with consumers who also support those green values.

4. Execute an effective marketing strategy

How does your product reach customers? How do you convince customers that your brand is the best choice? This may indeed be a task that must be carried out by the marketing team.

Apply the right marketing strategy to market the brand. Think about how to effectively reach customers because every business has a different approach, according to the type of industry and target market.

Execute an effective marketing strategy to reach the right consumers. Choose media to carry out promotions, make offers and promos to attract buyers.

Examples of Brands Successfully Implementing Brand Equity

1. Starbucks

This coffee shop brand from America has successfully opened its outlets in several countries. Even in Indonesia, Starbucks has counted 440 outlets widely spread in densely populated urban areas, even on several tourist islands.

Starbucks managed to hook its target market in Indonesia. Even though they sell drinks starting at IDR 40,000, many people still prefer Starbucks over other coffee shops with lower prices. In fact, many of them become loyal consumers, why?

Of course there are many factors that influence it, one of which is the existence of the brand. The Starbucks brand itself is a selling point . It doesn’t always have to be about coffee, they ‘sell’ the convenience of being a meeting place for the community. This is what makes it superior to competitors.

2. Coca-Cola

What’s the first thing you call when you want to buy a soft drink? Coca cola, the most popular brand of soft drink in the world. Coca Cola is also known to be very iconic because of its unique marketing campaign. It has a profit margin of 26.7% as of June 2020. Even Coca Cola can replace the mention of soft drinks with Coca Cola.

3. Hansaplast

Who doesn’t know this plaster brand? Brand awareness of the hansaplast brand is very good, for example if we have a small wound on our hand or foot, we will automatically ask to take or buy hansaplast even though it is not certain that what is given or what is bought is the hansaplast brand but we are used to mentioning all brands of plaster instant wound called hansaplast. Even though hansaplast itself is a brand of instant wound plaster, not the term for the plaster.


Google controls 9-% of the world’s search engine market sector. About more than four billion people worldwide use Google. Maybe you searched for this article also from Google. If you get lost somewhere, then the first thing you search for is Google. If you want to see a recipe, then you will search for it on Google. In fact, Google can also be a personal assistant.

5. Apples

Apple even surpasses Google in terms of brand equity. Most of their positive reputation is built on excellent electronic-type products such as iPhone, Mac, iCloud, and so on. For example, every time Apple releases an iPhone product, people will be excited and hunt for it even though the price is exorbitant. People will be more confident if they take out a cellphone with the Apple logo on it and that is the effect of the high brand equity built by Apple.

Sinaumed’s, that’s an explanation of Brand Equity , starting from the elements, how to build or improve it, to examples. Hopefully all the discussion in this article is useful and can also add insight to Sinaumed’s.