What causes brand equity to exist? How do marketers create it? Customer-based brand equity occurs
when the consumer has a high level of awareness and familiarity with the brand and holds some strong, favorable, and unique brand associations in memory. In some cases, brand awareness alone is enough to create favorable consumer response; for example, in low-involvement decisions when consumers are willing to base their choices on mere familiarity. In most other cases, however, the strength, favorability, and uniqueness of brand associations play a critical role in determining the differentialresponse that makes up brand equity. If customers perceive the brand as only representative of the product or service category, then they’ll respond as if the offering were unbranded. Thus marketers must also convince consumers that there are meaningful differences among brands.Consumers must not think all brands in the category are the same. Establishing a positive brand image in consumer memory strong, favorable, and unique brand associations goes hand-in-hand with creatingbrand awareness to build customer-based brand equity. Let’s look at both these sources of brand equity.
Brand Awareness
Brand awareness consists of brand recognition and brand recall performance: • Brand recognition is consumers’ ability to confirm prior exposure to the brand when given the brand as a cue. In other words, when they go to the store, will they be able to recogniz the brand as one to which they have already been exposed?
• Brand recall is consumers’ ability to retrieve the brand from memory when given the product category, the needs fulfilled by the category, or a purchase or usage situation as a cue. In other words, consumers’ recall of Kellogg’s Corn Flakes will depend on their ability to retrieve the brand when they think of the cereal category or of what they should eat for breakfast or a snack, whether at the store when making a purchase or at home when deciding what to eat.
If research reveals that many consumer decisions are made at the point of purchase, where the brand name, logo, packaging, and so on will be physically present and visible, then brand recognition will be important. If consumer decisions are mostly made in settings away from the point of purchase, on the other hand, then brand recall will be more important.For this reason, creating brand recall is critical for service and online brands: Consumers must actively seek the brand and therefore be able to retrieve it from memory when appropriate. Note, however, that even though brand recall may be less important at the point of purchase, consumers’ brand evaluations and choices will still often depend on what else they recall about the brand given that they are able to recognize it there. As is the case with most information in memory, we are generally more adept at recognizing a brand than at recalling it.
Advantages of Brand Awareness. What are the benefits of creating a high level of brand
awareness? There are threelearning advantages, consideration advantages, and choice advantages.
Learning Advantages: Brand awareness influences the formation and strength of the associations that make up the brand image. To create a brand image, marketers must first establish abrand node in memory, the nature of which affects how easily the consumer learns and stores additional brand associations. The first step in building brand equity is to register the brand in theminds of consumers. If the right brand elements are chosen, the task becomes easier.
Consideration Advantages: Consumers must consider the brand whenever they are making a purchase for which it could be acceptable or fulfilling a need it could satisfy. Raising brand awareness increases the likelihood that the brand will be a member of the consideration set, the handful of brands that receive serious consideration for purchase.Much research has shown that consumers are rarely loyal to only one brand but instead have a set of brands they would consider buying and another possibly smaller set of brands they actually buy on a regular basis. Because consumers typically consider only a few brands for purchase, making sure that the brand is in the consideration set also makes other brands less likely to be considered or recalled
Choice Advantages: The third advantage of creating a high level of brand awareness is that it can affect choices among brands in the consideration set, even if there areessentially no other associations to those brands.For example, consumers have been shown to adopt a decision rule in some cases to buy only more familiar, wellestablished brands. Thus, in low-involvement decision settings, a minimum level of brand awareness may be sufficient for product choice, even in the absence of a well-formed attitude
One influential model of attitude change and persuasion, the elaboration-likelihood model, is consistent with the notion that consumers may make choices based on brand awareness considerations when they have low involvement. Low involvement results when consumers lack either purchase motivation (they don’t care about the product or service) or purchase ability (they don’t know anything else about the brands in a category).
1. Consumer purchase motivation: Although products and brands may be critically important to marketers, choosing a brand in many categories is not a life-or-death decision for most consumers. For example, despite millions of dollars spent in TV advertising over the years to persuade consumers of product differences, 40 percent of consumers in one survey believed all brands of gasoline were about the same or did not know which brand was best. A lack of perceived differences among brands in a category is likely to leave consumers unmotivated about the choice process.
Consideration Advantages: Consumers must consider the brand whenever they are making a purchase for which it could be acceptable or fulfilling a need it could satisfy. Raising brand awareness increases the likelihood that the brand will be a member of the consideration set, the handful of brands that receive serious consideration for purchase.Much research has shown that consumers are rarely loyal to only one brand but instead have a set of brands they would consider buying and another possibly smaller set of brands they actually buy on a regular basis. Because consumers typically consider only a few brands for purchase, making sure that the brand is in the consideration set also makes other brands less likely to be considered or recalled
Choice Advantages: The third advantage of creating a high level of brand awareness is that it can affect choices among brands in the consideration set, even if there areessentially no other associations to those brands.For example, consumers have been shown to adopt a decision rule in some cases to buy only more familiar, wellestablished brands. Thus, in low-involvement decision settings, a minimum level of brand awareness may be sufficient for product choice, even in the absence of a well-formed attitude
One influential model of attitude change and persuasion, the elaboration-likelihood model, is consistent with the notion that consumers may make choices based on brand awareness considerations when they have low involvement. Low involvement results when consumers lack either purchase motivation (they don’t care about the product or service) or purchase ability (they don’t know anything else about the brands in a category).
1. Consumer purchase motivation: Although products and brands may be critically important to marketers, choosing a brand in many categories is not a life-or-death decision for most consumers. For example, despite millions of dollars spent in TV advertising over the years to persuade consumers of product differences, 40 percent of consumers in one survey believed all brands of gasoline were about the same or did not know which brand was best. A lack of perceived differences among brands in a category is likely to leave consumers unmotivated about the choice process.
2. Consumer purchase ability: Consumers in some product categories just do not have the necessary knowledge or experience to judge product quality even if they so desired. The obvious examples are products with a high degree of technical sophistication, like telecommunications equipment with state-of-the-art features. But consumers may be unable to judge quality even in low-tech categories. Consider the college student who has not really had to cook or clean before, shopping the supermarket aisles in earnest for the first time, or a new manager forced to make an expensive capital purchase for the first time. The reality is that product quality is often highly ambiguous and difficult to judge without a great deal of prior experience and expertise. In such cases, consumers will use whatever shortcut or heuristic they can come up with to make their decisions in the best manner possible. Sometimes they simply
choose the brand with which they are most familiar and aware.
Establishing Brand Awareness. How do you create brand awareness? In the abstract, creatingbrand awareness means increasing the familiarity of the brand through repeated exposure, although this is generally more effective for brand recognition than for brand recall. That is, the more a consumer “experiences” the brand by seeing it, hearing it, or thinking about it, the more likely he or she is to strongly register the brand in memory. Thus, anything that causes consumers to experience one of a brand’s element—its name symbol, logo, character, packaging, or slogan, including advertising and promotion, sponsorship and event marketing, publicity and public relations, and outdoor advertising—can increase familiarity and awareness of that brand element. And the more elements marketers can reinforce, usually the better. For instance, in addition to its name, Intel uses the “Intel Inside” logo and its distinctive symbol as well as its famous four-note jingle in TV ads to enhance awareness.
Repetition increases recognizability, but improving brand recall also requires linkages in memory to appropriate product categories or other purchase or consumption cues. A slogan or jingle creatively pairs the brand and the appropriate cues (and, ideally, the brand positioning as well, helping build a positive brand image). Other brand elements like logos, symbols, characters, and packaging can also aid recall. The way marketers pair the brand and its product category, such as with an advertising slogan, helps determine the strength of product category links. For brands with strong category associations, like Ford cars, the distinction between brand recognition and recall may not matter much—consumers thinking of the category are likely to think of the brand. In competitive markets or when the brand isnew to the category, it is more important to emphasize category links in the marketing program. Strong links between the brand and the category or other relevant cues may become especially important over time if the product meaning of the brand changes through brand extensions, mergers, or acquisitions.
choose the brand with which they are most familiar and aware.
Establishing Brand Awareness. How do you create brand awareness? In the abstract, creatingbrand awareness means increasing the familiarity of the brand through repeated exposure, although this is generally more effective for brand recognition than for brand recall. That is, the more a consumer “experiences” the brand by seeing it, hearing it, or thinking about it, the more likely he or she is to strongly register the brand in memory. Thus, anything that causes consumers to experience one of a brand’s element—its name symbol, logo, character, packaging, or slogan, including advertising and promotion, sponsorship and event marketing, publicity and public relations, and outdoor advertising—can increase familiarity and awareness of that brand element. And the more elements marketers can reinforce, usually the better. For instance, in addition to its name, Intel uses the “Intel Inside” logo and its distinctive symbol as well as its famous four-note jingle in TV ads to enhance awareness.
Repetition increases recognizability, but improving brand recall also requires linkages in memory to appropriate product categories or other purchase or consumption cues. A slogan or jingle creatively pairs the brand and the appropriate cues (and, ideally, the brand positioning as well, helping build a positive brand image). Other brand elements like logos, symbols, characters, and packaging can also aid recall. The way marketers pair the brand and its product category, such as with an advertising slogan, helps determine the strength of product category links. For brands with strong category associations, like Ford cars, the distinction between brand recognition and recall may not matter much—consumers thinking of the category are likely to think of the brand. In competitive markets or when the brand isnew to the category, it is more important to emphasize category links in the marketing program. Strong links between the brand and the category or other relevant cues may become especially important over time if the product meaning of the brand changes through brand extensions, mergers, or acquisitions.
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