Brand Value - Value of the invaluable.

"Brand!!!!", a very common word which we come across at least 10 times a day. We are also very much acquainted with the word Brand Value. But, what is brand value? how to define it? is it measurable? all these are quite difficult to answer. If defined in a layman's language, Brand Value is the amount of acceptance and respect which we receive while wearing the employee tag of a very reputed firm such as Apple or Coca Cola. but the depth of the word Brand Value is beyond that. The most authentic one to speak about brand value and brand equity at present is "Interbrand". Interbrand, a division of Omnicom is an american global branding consultancy which works on brand analytic's, brand strategy, brand valuation etc... Interbrand was started in 1974 when the world thought of the word Brand as just a synonym for logo. They changed the worlds perceptions about brand management and brand value by managing brand as valuable business assets and by evaluating the brand value of global brands annually. Interbrand released their 2013 survey results recently and in the result "Apple" stands first as the best brand in the world with a brand value of $ 98,316 million. This article deals with Brand valuation method, brand elements and Brand Resonance model formulated by Keller.

Before going deep into brand equity, we should know what does brand mean. The American Marketing Association defines a Brand as "A name, term, sign, symbol, or design, or a combination of them intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors." Branding is a simple concept of differentiating our product from others using the power and recognition of brand name. And now comes the major thing, Brand Equity or Brand value. It is the added value endowed on products or services due to the brand name. For example, when we are ready to pay a premium price for an iphone just because of the brand name "Apple", that is the brand value of Apple. This is the sole reason why Apple stands first in the Interbrand survey results. There are a lot of models to explain the brand equity, but what I found as the most relevant is the Keller's brand resonance model. Brand resonance model speaks of Brand development as a series of four steps, and each stage is assisted with certain factors called as Building blocks of a brand. The first stage is Brand Identity.

Brand Identity. 
This is the level to which people identify your brand name and it is established by Brand Salience. Salience means the frequency in which people think about the brand name. In short it is deep and broad Brand awareness. If we consider Apple as an example, there is no need of explaining the brand awareness which it possess. When an average man hears the word apple, the brand Apple comes to his mind before the fruit. This is because of the well established brand salience of Apple. The second stage is developing the Brand Meaning.

Brand Meaning
Brand meaning is developed through establishing performance and imagery. Brand performance is how good or how well is the product. It can be developed only through the quality of the product and the level to which it satisfies the functional needs of the customers. Apple products possess high quality and it has a well established brand performance as the customers have a perception that there is nothing better than Apple products. We often hear from them the famous quote "apple is apple". The second element for brand meaning is Imagery. Brand Imagery is how well you meet the customers needs in a social or psychological level. Apple always stand for innovation and change and customers perceive it as a status symbol, because they carry the change. Now comes the third stage, that is building Brand Response. 

Brand Response.
It is the feelings and reactions of the customers towards the brand. It is developed by establishing Judgments and feelings about the brand. Judgments are the customers own personal opinions and previous experiences regarding the brand and feelings are the customers emotional response when they hear a brand name. one reason for Apple to stay in the top level in terms of brand value is due to the customers perception about the products of Apple as a status symbol and their feeling that they own the best when they own an Apple product. The product quality of Apple also plays a part because all the branding strategies are in vain if the product do not stand. And the final stage of Brand building is Developing Brand Relationship.

Brand Relationship
Here the brand tries to create a psychological bonding between the customers and they feel like these names are the part of their day to day life. The phenomenon is called as Brand Resonance. Resonance means the intensity of customers psychological bond with the brand. Global Brands like Apple, Google and Coca Cola has gained the first three spots in the Interbrand's List of Top 100 Brands of 2013, mainly because of their high resonance. All these three brand names are pronounced by a person at least once a day. Finally, the brand building strategies of all the firms aim upon increasing the Brand resonance of their own brand.

Keller's Resonance pyramid is only one among the different brand building models; though this is the most recommended. I used Apple as a major example to explain this model because of its latest triumph by becoming the firm with highest brand value surpassing Coca Cola which stood first in 2012. Building Brand equity is not just a theory of four steps. Establishing all these stages requires careful planning, Support from advertisements and other promotional strategies and right choice of brand elements such as name, logo etc. for example, the logo of Apple is an amazing example of leveraging on brand elements. The Apple logo is memorable, meaningful and likable which gives them a huge advantage in building up their Brand equity. Even though i tried to explain the resonance model with the help of Interbrand and its Top 100 list, the Brand Valuation method of Interbrand is different. It consists of five different steps i.e, Market segmentation, Financial Analysis, Contribution of Branding, Brand Strength Measurement and NPV of forecasted Brand earnings. This method will be explained in detail in another post. Follow The Blog to get notified!!!!