Understanding Branding Awareness
If you're not familiar with the term brand equity, here's a refresher. Brand equity measures how recognizable a brand is. It can refer to memorable products, service quality, or even availability through a well-developed distribution network.
Building and measuring brand equity is incredibly important for cultivating relationships and making products stand out. Here's an introduction to what it is and how to measure it correctly.
Related: 3 steps to building brand consistency- What brand equity is (and isn't)
Brand equity covers several important elements. The critical ones include Clients' perceptions. How that perception affects the company (from interactions to purchases) Sales and revenue Brand awareness in the market at large. Due to its complex nature, there seems to be some confusion on exactly what brand equity is and isn't. It's not any of these things:
Market equity—a term that refers to the actual value of assets. An engaging shopping experience—which is only one aspect of a brand. A business outcome in itself—it's the means to accomplish that outcome Brand value. How the company is perceived right now—equity has long-term implications.
Brand equity interacts with other aspects of running a business, and measuring it isn't a simple task. You need to understand which activities contribute most to making the brand recognizable. Then you'll be better at tracking the metrics that matter.
Choosing the right metrics
The first goal of measuring brand equity is selecting the right metrics. This data should offer insights about the perception of your audience and the effects of your actions. While the right metrics might vary from one company to another, here are a few essentials:
Brand awareness Accessibility and market penetration. Customer loyalty and retention Market share Growth rate Revenue and profitability fluctuations. Cost to acquire new clients and cost to retain clients Emotional associations with the brand (positive or negative). As you can see, relevant metrics pertain both to market positioning and emotional response. While emotions can be harder to evaluate, they provide valuable insight into how your branding efforts are being received.
Looking for trends
One useful strategy for interpreting brand equity metrics is looking for trends and patterns. Regardless of company size, you're probably collecting some form of data all the time. Sorting through all the information to make sense of the numbers and their relevance can be painstaking, even if you're relying on automation.
This is why many marketers choose to identify anomalies rather than consistencies in trends. An anomaly or outlier could be indicative of change. From there, you can determine what event caused the outlier and whether it that's good or bad.
It's also important to have a strong understanding of the industry as a whole. If demand is going down and competitors are experiencing similar trends, it's likely that the change in data isn't related to your brand equity.
Pinpointing anomalies is easy—identifying the cause is more cumbersome. You need deep industry knowledge to look at the big picture effectively. Then you can better understand how you've positioned yourself differently from others and why you're experienced such a change in perception, revenue or whatever metric you're examining.
Evaluating your brand image
Evaluating your current brand image is helpful because it points to how brand equity could change in the years to come. This metric is more abstract than financial indicators, but it's wise to include both quantitative and qualitative factors in your audit.
Your brand's digital presence can be invaluable in understanding the current brand image and the attributes that buyers assign to your products.
Social media interactions shed light on how your brand is being perceived right now. Remember: perception is nearly as important as your revenue figures because it has the potential to shape revenue to come. A good brand image can help you build sustainability in the long run; a bad one can ruin your efforts.
Learn to interact with customers on a regular basis. Whether you do it through digital means or in person is up to you; what matters is testing a large enough sample to reliably determine trends in perception.