This chapter discusses brand equity and how to build and maintain strong brands. It covers key concepts like brand, brand promise, brand equity, brand reinforcement, and developing a brand strategy. The goal is to create brand loyalty and maximize customer lifetime value by consistently meeting customer needs through the brand experience. Models and frameworks are presented for measuring brand equity, mapping brand strength, and conducting brand audits to improve marketing strategies.

1. Marketing Management
By Philip, Kevin Lane Keller, Abraham Koshy, Mithileshwar Jha
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SUMMARY by
Chapter 10
Creating Brand Equity
It is important for the marketer to create a strong brand and maintain customer loyalty. This
chapter talks about the concepts of brand and how branding works. We will understand
what brand equity is, how it is built and measured as well as the decisions involved in
branding strategy.
Brand:
A name, term, sign,
Brand Equity
Added value endowed on products and services. Reflected in way consumers think, feel and
symbol or design, or a act with respect to a brand. Customer based brand equity – differential effect brand
combination of them, knowledge has on customer response to the marketing of a brand. Maybe positive or
intended to identify negative depending on how consumers respond. It has three key ingredients –
• Brand equity arises from differences in customer response
the goods or services
• Differences in response are a result of consumer’s knowledge of the brand. Brand
of one seller or group
Knowledge consists of all thoughts, feelings, images, experiences, beliefs and so on that
of sellers and to become associated with the brand
differentiate them • The differential response is reflected in perceptions, preferences and behaviour related
from those of to all aspects of the marketing of the brand
Marketer must build a strong brand that ensures that the consumers have the right
competitors.
experiences.
Brand Promise
Marketer’s vision of what the brand must be and do for the consumers. The true and future
value depends on customers, their brand knowledge and their likely response to marketing
activity.

2. Chapter 10 - Creating Brand Equity
Trends
Brand Equity Models
Brand Asset Valuator
It provides comparative measures of the brand equity of thousands of brands across
hundreds of different categories.
Leaders
Up and
coming/Niche Google
(Differentiation, Relevance, Energy)
Brand JetBlue USA
Pringles
Declining
Leaders
Energized Brand Strength
Ikea
Nike Kodak
Element: TiVo
Redbull
AAA
Tide
Those trademark able
devices that identify
New/Undeveloped Eroded/Commoditized
and differentiate the
Blackberry Centrum
brand. Most strong Sephora Entertainment Weekly
brands employ SAP Wells Fargo
Brtish Airways Budget Rent-A-Car
multiple brand
elements. Brand
element choice Brand Structure
(Esteem & Knowledge)
criteria includes 6 (E
There are the five key components of the model –
main parameters –
1. Differentiation – degree to which a brand is seen as different from others
first three being 2. Energy – brand’s sense of momentum
memorable, 3. Relevance – breadth of brand’s appeal
4. Esteem – how well the brand is regarded and respected
meaningful and
5. Knowledge – how familiar and intimate customers are with the brand
likable (‘brand
building’) and last Brand Resonance Model
three being Creation of significant brand equity requires reaching the top or pinnacle of the brand
transferable, pyramid, which occurs only if the right building blocks are put into place.
adaptable and
protective
(‘defensive’). Resonance
Judgement Feelings
Performance Imagery
Salience

3. Chapter 10 - Creating Brand Equity
•
Trends
Brand Salience – how often and how easily customers think of the brand under
various purchase or consumption situations.
• Brand Performance – how well the product or service meets customers’ functional
needs
• Brand Imagery - describes the extrinsic properties of the product or service; also the
way in which brand attempts to meet customers’ psychological or social needs
• Brand Judgements – focus on customers’ own personal opinions and evaluations
Brand • Brand Feelings – customers’ emotional responses and reactions with respect to the
brand
Reinforcement • Brand Resonance – nature of the relationship customers have with the brand and the
extent to which they feel they’re “in sync” with it
Brand needs to be
Brand Audit – consumer focussed series of procedures to assess the health of the
managed so its value brand, uncover its sources of brand equity and suggest ways to improve and leverage its
does not depreciate. equity.
Brand equity
reinforced by Brand Valuation – Job of estimating the total financial value of the brand.
marketing actions that
consistently convey the Devising a Brand Strategy
meaning of the brand When a firm introduces a new product it has 3 choices –
in terms of what it • Develop new brand elements for the new product
represents and how it • Apply some of the existing brand elements (Product is called brand extension)
• Use a combination of new and existing brand elements (Maybe called a sub brand)
makes the products
superior. Reinforcing
requires innovation Brand Portfolios
Marketers need multiple brands to cater to multiple markets. The reasons for diversifying
and relevance
the brand portfolio -
throughout the 1. Increasing shelf presence and retailer dependence in the store
marketing program. 2. Attracting customers seeking variety who may otherwise have switched to another
brand
3. Increasing internal competition within the firm
4. Yielding economies of scale in advertising, sales, merchandising and physical
distribution
Customer Equity
Sum of lifetime values of all customers. The aim of Customer Relationship Management
(CRM) is to produce high customer equity.