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What is Brand Equity?

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Brand equity is the financial value of a brand to a firm. This is based on customer recognition of the brand and association of the brand with positive attributes. Negative brand equity also exists whereby a brand has negative attributes in the minds of customers. In this case, products would sell better under a new brand even if that brand had zero brand equity. The following are basic components of brand equity.
Brand Awareness
Brand Culture
Brand Image
Brand Loyalty
Brand Recognition
Brand Reputation
Customer Experience
Employer Branding (talent who want to work for the brand)
Internal Branding (employee pride in the brand)
Market Share
Perceived Quality
Perceived Social Status
Perceived Value
Pricing Power
The value of a brand can mostly be determined by a few key variables such as brand recognition, market share (revenue) and pricing power (relative margins).

Valuing Brands

Brands clearly have value and are often recognized as intangible assets in accounting. That being said, it's very difficult to calculate an accurate value for a brand. For this reason, brand value is generally considered an estimate as opposed to a concrete financial value. This changes if you purchase a brand from another company, as the transaction is concrete evidence of the brand's value.
Overview: Brand Equity
Definition (1)
The financial value of a brand to a firm.
Definition (2)
The value of customer recognition and perceptions of a brand.
Also Known As
Brand Value
Related Concepts


This is the complete list of articles we have written about branding.
Brand Architecture
Brand Attributes
Brand Authenticity
Brand Awareness
Brand Development
Brand Diffusion
Brand Equity
Brand Experience
Brand Extension
Brand Family
Brand Guidelines
Brand Identity
Brand Loyalty
Brand Management
Brand Metrics
Brand Objectives
Brand Perception
Brand Positioning
Brand Recognition
Brand Status
Brand Strategy
Brand Voice
Moment Of Truth
Product Line
Top Of Mind
Types Of Brand
Umbrella Brand
Visual Marketing
More ...
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