Every brand needs to care about it’s value in the marketplace – and that is what brand equity boils down to. Brand equity is the value of having a recognisable brand name, because a more recognisable brand will make more money from similar products/services than those provided by a less recognisable brand.
In his definition of brand equity, David Aaker provides a clear view of the closeness of the relationship between brand identity and brand equity: “…a set of assets and liabilities linked to a brand, its name and symbol, that adds to or subtracts from the value provided by a product or service to a firm and/or to that firm’s customers.”
A brand is one of the most valuable assets to any organisation. To some it is the most valuable asset. Where, for instance, would Coca-Cola be if their brand entirely disappeared overnight? Their brand image, and as a result their brand equity, is worth more than all of the rest of the assets of the organisation put together. Remove the brand and the value of the brand is reduced to nothing. No one would purchase a can of (insert generic soft drink name here) because the brand would be unrecognisable and thus, to the consumer, a less desirable product. This is precisely why organisations protect their brand identity so fiercely, because they are acutely aware of how valuable a resource it is.
It isn’t just huge organisations that need to build brand equity. Small organisations, the public sector and nonprofits all need to work at building their brand equity. The future success of any brand relies on increasing recognition, awareness and consumer loyalty, and communication (of which brand identity is key) is integral to all of these aspects.
An organisation that doesn’t invest in brand identity is risking their brand equity. Equally, a “Steady investment in design is rewarded by lasting competitiveness.” (Design Council UK).
Missed reason #1 (making it easier for the customer to buy)? Find it here.