Marketing Management
Marketing, Branding and Brand Equity


In today competitive business environment, marketing is becoming a more important element to be properly and effectively managed by business owners and managers. As the business environment is becoming dynamic, volatile and competitive, it is crucial for the firms to enhance the marketing effectiveness and capabilities of the firm to stay relevant, competitive and profitable in the every challenging marketplace. It is becoming hard to stay competitive with only efficient operational activities alone, as that had become a bottom line to compete in this new economy. The various businesses are working hard to get the attention of the customers and prospects alike to lure the customers to their value offerings. Not only that, the ability to fulfill customers’ needs and requirement in an accurate and effective manner is becoming more critical, as in this information and knowledge era, customers are becoming more demanding and knowledgeable in their consumption decisions. Thus, with all these trends being observed, it is safe to conclude that any firms that which to become competitive and profitable in the new era must possess strong marketing capabilities.

Under effective and prudent marketing management of a company, there are many areas to be focused and learned by a manager. At the very early stage, a market should understand the STP process (i.e., segmentation, targeting and positioning), the marketing mix, the consumer behaviors, the marketing plan and many others. All of these topics are crucial in enhancing the marketing capabilities of a firm in the new economy. Fortunately, many of these topics are widely discussed in business related reference book, literature, business magazines, and even academic-related business textbooks. Thus, to obtain such information, for decision making or advices purposes for manager is not a hard issue. However, the topic on brand equity is hardly discussed in the public materials that are easily assessable by business managers. Thus, it is one of the reasons that the issues related on brand equity are selected as the topic to be discussed in this writing.

Not only that, it is also understood that as the business is becoming more competitive whereby more participants are joining a business landscape, making the business or industry environment becoming more crowded, it is becoming more important for a firm to try to stand out from the competition, through a strong brand name in the marketplace. Thus, branding is becoming a crucial element to be properly managed, and designed in crafting the marketing campaign or mix in attracting and retaining customers under such business environment. Thus, this writing choose to discuss, research, and study on the theoretical framework and literature concerning the issues of branding, particularly focusing on the topics related to brand equity and customer-based brand equity as these issues are essential for modern companies to compete in the challenging and dynamic marketplace today and in the future.

Under the context of branding or brand equity, one of the most widely used and accepted model and framework is developed by Aaker (1991). It is found that many other researchers since 1990s, are adopting the framework suggested by Aaker (1991) in conducting surveys and study for the various case studies and companies. As such, viewing from the fact that such framework is apparently widely accepted and recognized by many other researchers, it is rationale to select the model of brand equity developed by Aaker (1991) for the research purpose in this writing, which is aimed to study the concepts and issues related to branding and brand equity. Apart from that, that concept o brand equity developed and popularized by Aaker (1991) was then further redefined and improved by Keller (1993) to form the concepts of customer-based brand equity. The defined and improved conceptual framework of customer-based brand equity is also widely recognized and cited in many works by other researchers. Thus, it is also important that this writing incorporate the concepts suggested and argued by Keller (1993) in forming the research process. In the next section, the concepts and issues of branding, brand equity as well as customer brand equity will be articulated.


Brand Equity and Consumer Choices

Branding is a hotly debated and researched topic nowadays. Such a phenomenon is not surprising, as the business environment is becoming more competitive and businesses are becoming more dependent on their reputation to attain competitive advantages in the marketplace. Consistent with the importance of branding effects in the challenging business landscape, the concepts of brand equity is introduced by researchers. In the challenging economy today, branding is a famous and crucial marketing topic and philosophy widely researched by both academicians and managers. In laymen term, the word brand can be described as the reputation or perception of a company in the marketplace. Thus, a finely crafted brand will deliver its unique brand experience to the consumers. Specifically, brand experience can be defined as the consumer’s previous perception, experience and memory on the products or services provided by a company. Another vital concept under the topic of branding is the concept of brand image. Technically speaking, the word brand image is usually defined as the psychological as well as symbolic construct formulated within the minds of the consumers (Barwise, 1993; Don, 2000). To further explain, it is also mentioned that a brand image often comprises of all the relevant information and expectations associated to the product or services provided by a firm (Neal et. al., 2008).


 i.     Importance of Branding

In the business world, properly designed branding can deliver different advantages for both the customers and the business person involved in the goods exchange process. Theoretically speaking, branding makes the buying and selling process more effective as well as it is vital to deliver useful information to the consumers (Erenkol et. al., 2010). Many advantages of a well-defined and formulated branding are presented in the following paragraphs.

Advantages of branding #1: the first advantage of branding is that it enables us to create or formulate a unique, identifiable, and special identity for a company, a product or a service in the marketplace. Such an identity is crucial because it enable the customers to differentiate something from the others. As the customers able to differentiate the products from those of the competitors, they can then associate the correct buying experience, expectations and perception on a particular product. Not only that, a well designed brand can also deliver both rational and emotional impacts to the consumers, as people tend to select reputable, respectable and reliable products for consumptions if possible(Kotler & Armstrong, 1996). This is particularly true as when more companies compete in a big market, the brand is often used as the heuristic for decision making process (Erenkol et. al., 2010).

Advantages of Branding #2: The second benefit of a brand is to convey crucial information to the customers, consumers or end users. This is extremely important as there are too many players in a single industry today. Every corporation is trying hard to stand out from the competition, stand for something and to associate its products or services with a unique concept that can be easily remembered by the consumers (Dibb et. al., 2001). Not only that, as the brand able to convey crucial information to the consumers, it will assist the consumers to make better decision, to locate the products, or to recommend the products to others (Blackston, 1995).

Advantages of branding #3: the third advantage of a well designed brand image is to enhance customers’ loyalty in the marketplace. This is possible as when the customers are happy or having pleasure experiences with a product or service, they tend to remember the brand of that product or service. Thus, they will likely to stick to the similar brand in the future, as will act as the repeat consumers for a product (Lancaster & Reynolds, 2001). In fact, when a product is outstanding, the brand can also serve as the ‘pull’ marketing element that will attract consumers or buyers for a particular products or services. This is not uncommon, as people tend to spread the news around when they found something excellent. The word of mouth effect will soon attract more buyers to a product or service of the brand widely promoted by their friends, family members or others.


ii.     Brand Equity

The importance of branding gives rise to the concept of brand equity. In fact, as early as 1991, the concept of brand equity was defined by Aaker as the set of brand assets and liabilities linked to a products or services reputation, its name, logo, symbol that can add or subtract the total value delivered by a product or service from a firm to the customers or end users. Generally speaking, the main idea is that the responses of customers to a brand of a particular product or service are directly related to the brand equity of the product (Erenkol et. al., 2010). Brand equity of a company is important because it can either increases or decreases brand value for customers. It is powerful because it can affect customers’ decision making process before purchasing a particular product or service. This is easily understood as well-recognized and acknowledged brand images for customers is in fact a highly valuable asset for a company to take advantage of in competing in the challenging business environment. Following that line of argument, it is then important for a company to keep an eye on the company’s branding initiatives or strategies so that the company brand images and reputation in the marketplace is being take care of. According to Aaker (1991), it is pointed out that brand equity can be categorized into five dimensions, namely, (a) brand loyalty, (b) brand awareness, (c) perceived quality, (d) brand association, and lastly (e) other proprietary brand assets.


iii.     Customer-Based Brand Equity

Customer-based brand equity is often regarded by researchers as the conceptual extension of brand equity. The concept of customer-based brand equity is developed by Keller (1993) with reference to Aaker’s (1991) brand equity theory. According to Keller (1993), customer-based brand equity can be defined as the consumer’s reaction to different brands from marketing strategies when consumers have diverse brand knowledge. According to Keller, the brand knowledge of customers is influenced by a company’s marketing activities and daily interaction with the customers. Brand knowledge is said to have two components, (a) brand awareness and (b) brand image. To be more precise, brand awareness is described as the consumers’ ability to recall or recognize a particular brand. On the other hand, brand image refers to the set of associations the consumers relate to a particular brand. It is argued by Keller (1993) that customer-based brand equity has effects on brand knowledge and customers reactions to the elements of the marketing mix for the brand when compared to an unnamed brand or competing product or service provider.

As it is discussed above, customer-based brand equity is referred to customers’ reaction to marketing activities of a firm based on their preceding brand knowledge. In other words, the customers’ perceptions, preferences, and behaviors will be affected by marketing activities of a firm. Thus, marketing activities of a firm will affect the brand choices of customers. It is because of this that many scholars and practitioners have been interested to study more into the subject of brand equity – as to leverage on it to better influence consumer behaviors (Wood, 2000; Blackston, 1995).




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